## Related questions with answers

Question

In $2000$, the median home price in New York City was about $\$ 300,000$, and from $2000$ to $2006$, home prices in New York City rose at an average rate of about $11 \%$ per year. If prices had continued to rise at that rate, what would the median home price have been in $2017$? Compare to the actual median price of about $\$ 400,000$ in $2017$.

Solution

VerifiedAnswered 2 years ago

Answered 2 years ago

Using the general expression for exponential growth with the initial value $P_0=300\ 000$ and the growth rate $r=0.11$ we can determine the price of the home price in $2017$ as

$\begin{align*} P&=P_0\left(1+r\right)^t\\ &=300\ 000\left(1+0.11\right)^{17}\\ &=300\ 000\cdot1.11^{17}\\ &=1\ 768\ 527.81 \end{align*}$

The median home price would be $\$1\ 768\ 527.81$.

## Create a free account to view solutions

By signing up, you accept Quizlet's Terms of Service and Privacy Policy

## Create a free account to view solutions

By signing up, you accept Quizlet's Terms of Service and Privacy Policy

## Recommended textbook solutions

#### Mathematics for Business and Personal Finance

1st Edition•ISBN: 9780078805059 (1 more)Lange, Rousos4,857 solutions

#### Using and Understanding Mathematics: A Quantitative Reasoning Approach

7th Edition•ISBN: 9780134705187 (3 more)Jeffrey O. Bennett, William L. Briggs3,437 solutions

#### Financial Algebra

1st Edition•ISBN: 9780538449670 (1 more)Richard Sgroi, Robert Gerver2,606 solutions

#### Financial Algebra: Advanced Algebra with Financial Applications

2nd Edition•ISBN: 9781337271790Richard Sgroi, Robert Gerver3,016 solutions

## More related questions

1/4

1/7