Question

The value of a house increases by 20% every five years. If a house now costs $200,000, how much will it be worth in 30 years, rounded to the nearest thousand?

Answer 1

The value of the house after 30 years, with a 20% increase every five years, is approximately $597,000.

Step-by-step explanation:

To calculate the value of the house in 30 years, we need to determine the increase in value every five years. Given that the house increases by 20% every five years, we can calculate the new value at each interval and multiply it with the previous value to find the final value.

Step 1: Calculate the new value after each five-year interval:
After 5 years: $200,000 * 1.2 = $240,000
After 10 years: $240,000 * 1.2 = $288,000
After 15 years: $288,000 * 1.2 = $345,600
After 20 years: $345,600 * 1.2 = $414,720
After 25 years: $414,720 * 1.2 = $497,664
After 30 years: $497,664 * 1.2 = $597,196.8

Step 2: Round the final value to the nearest thousand:
The final value after 30 years is approximately $597,000 when rounded to the nearest thousand.