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You rent an apartment that costs $1700 per month during the first year, but the rent is set to go up 9% per year. What would be the rent of the apartment during the 12th year of living in the apartment? Round to the nearest tenth (if necessary).

Sagot :

Given :

You rent an apartment that costs $1700 per month during the first year, but the rent is set to go up 9% per year.

To Find :

The rent of the apartment during the 12th year of living in the apartment.

Solution :

Let, A is the final price after 12 year and P is the principal amount.

We know, by formula of compounding :

[tex]A = P( 1 + \dfrac{r}{100})^t\\\\A = 1700( 1 + \dfrac{9}{100} )^{12}\\\\A = \$4781.53[/tex]

Therefore, the rent of the apartment during the 12th year of living in the apartment is $4781.53 .

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