Question

Which statement(s) can be interpreted from the equation for a real estate value, V(t) = 228,000(1.03) where V() represents the value of the real estate and t represents the time in years?

The equation is an exponential growth equation.
O The equation is an exponential decay equation.
The equation is neither exponential decay nor exponential growth.
$220,000 represents the initial cost of a real estate that appreciates 3% per year over the course of tyears.
$228,000 represents the initial cost of a real estate that appreciates 30% per year over the course of years,
$228,000 represents the initial cost of a real estate that depreciates 3% per year over the course of years.
$228,000 represents the initial cost of a real estate that depreciates 30% per year over the course of t years

Answer 1

$220,000 represents the initial cost of a real estate that appreciates 3% per year over the course of t years.

Explanation:

Equation for a real estate value:
`V(t) = 228,000(1.03)^t`

Where V(t) represents the value of the real estate

t represents the time in years.

Exponential growth equation:
`y(t)=a(1+r)^t`

Exponential decay equation:
`y(t)=a(1-r)^t`

The given Equation for a real estate value can be written as :
`V(t) = 228,000(1+0.03)^t`

Om comparing with growth and decay equations

We conclude that it is the growth equation

Where r = 0.03 =3%

a=Initial cost = 228000

So, Option B is true

$220,000 represents the initial cost of a real estate that appreciates 3% per year over the course of t years.