To find the annual growth rate between 1987 and 2004, we can use the formula:
Growth rate = (final value - initial value) / initial value
Growth rate = (165,000 - 110,000) / 110,000
Growth rate ≈ 0.5
Rounding to 4 decimal places:
Growth rate ≈ 0.4545
To find the growth rate in percentage form, we multiply by 100:
Growth rate ≈ 45.45%
To find the value in the year 2009, we need to use the growth rate to calculate the value after 5 years from 2004:
Value in 2009 = (1 + growth rate)^5 * Value in 2004
Value in 2009 ≈ (1 + 0.4545)^5 * 165,000
Value in 2009 ≈ 2.8326 * 165,000
Value in 2009 ≈ 466,041
Rounding to the nearest thousand dollars:
Value in 2009 ≈ $466,000
A house was valued at $110,000 in the year 1987. The value appreciated to $165,000 by the year 2004.
A) What was the annual growth rate between 1987 and 2004?
r
=
Round the growth rate to 4 decimal places.
B) What is the correct answer to part A written in percentage form?
r
=
%.
C) Assume that the house value continues to grow by the same percentage. What will the value equal in the year 2009 ?
value = $
Round to the nearest thousand dollars.
1 answer
1 answer