Question

Roger’s home originally cost him $165,000. For the first six years he lived there, his house grew in value at a rate of 1.6% per year. After that, his property value increased by 3.9% per year for the next eight years. To the nearest hundred dollars, how much had Roger’s home increased in value after fourteen years?
a.
$76,200
b.
$75,600
c.
$81,500
d.
$56,400

Answer 1

Final value = 165000*(1.016)^6*(1.039)^8.
(1.016)^6 ≈ 1.099922909, (1.039)^8 ≈ 1.358076957, product ≈ 1.493779969.
End value ≈ 165000(1.493779969) ≈ 246,474, so increase ≈ 246,474 − 165,000 = 81,474.
To the nearest hundred dollars: $81,500. (Choice c)