Question

francisco purchased a house that was worth $198,000. the value of the house increased by 6% each year for the next 5 years. the value of the house at any given moment (during the first five years) is what percent of the value of the house exactly one year earlier?

Answer 1

After the first year, the value of the house would increase by 6% and become:

$198,000 + (6%/100) x $198,000 = $210,000

Similarly, after the second year, the value of the house would increase by 6% and become:

$210,000 + (6%/100) x $210,000 = $222,600

We can repeat this process for all five years to determine the final value of the house after 5 years:

$198,000 x (1 + 6%/100)^5 = $267,015.23

To find the value of the house as a percentage of the value exactly one year earlier, we can compare the value after 5 years with the value after 4 years:

$222,600/$210,000 = 1.0571

This means that the value of the house after 5 years is approximately 105.71% of the value exactly one year earlier, which is an increase of 5.71%.