Question

Fifteen years ago, russell bought his house for $141,000. the house’s property value has decreased by 1.6% per year ever since then. if russell sells his house, how much is it worth, to the nearest hundred dollars? a. $110,700 b. $107,200 c. $67,100 d. $37,900

Answer 1

a. $110,700

Explanation:

You want to know the value of a $141,000 house after 15 years, if it declines in value 1.6% each year.

Multiplier

The value multiplier each year is ...

1 - 1.6% = 1 -0.016 = 0.984

When the house value is multiplied by this factor 15 times, it becomes ...

$141,000×0.984^15 ≈ $110,700

Russell's house is worth about $110,700.