If a piece of real estate purchased for $50.000 in 1998 appreciates at the rate of 5% per year, then its value t years after the purchase will be f(t)=50,000(1.05^t). According to this modle, by how much will the value of this piece of property increase between the years 2007 and 2008?
50,000x1.05=52500, goes up 2500 every year, so my answer is 2500, in one year $2500. or in 10 yrs it has apprecites to 75,000. I'm not sure if I have set this one up right. Thanks so much for checking my answer.