f(t)=480(3/2)^t?

Question

If a piece of realestate purchased for 75,000 in 98 appreciates at the rate of 6% per year then its value t years after the purchase will be f(t)=75,000(1.06^t). how much will the value increasebetween years 05 and 08?

Answer 1

I'll answer your follow-up question, since your original question isn't really a question.

"If a piece of realestate purchased for 75,000 in 98 appreciates at the rate of 6% per year then its value t years after the purchase will be f(t)=75,000(1.06^t). how much will the value increasebetween years 05 and 08?"

This is really a "plug and chug". 2005 is 7 years after 98, so in 2005, the real estate is worth:

f(7) = $75,000(1.06)^7 = $112, 772.27

Then three years later is 10 years after 98, so:

f(10) = $75,000(1.06)^10 = $134,313.58

For a net increase of $134,313.58 - $112,772.27 = $21,541.31.