Answered

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the formula S=C(1 +r)^t models inflation, where C= the value body, r= the annual inflation rate (in decimal form), and S = the inflated value t years from now. if the inflation rate is 3%, how much will a house now worth $163,000 be worth in 15 years? round your answer to the nearest dollar

Sagot :

Since the actual value happens at t=0, then:

[tex]\begin{gathered} 163,000=C(1+0.03)^0 \\ \Rightarrow C=163,000 \end{gathered}[/tex]

Evaluate S(t) at t=15, with C=163,000 and r=0.03 to find the inflated value of the house 15 years later:

[tex]S(15)=163,000\cdot(1.03)^{15}[/tex]

Use a calculator to find a decimal expression for S(15):

[tex]S(15)=253,948.6889\ldots[/tex]

To the nearest dollar, the house will be worth $253,949

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