Question

You rent an apartment that costs \$1000$1000 per month during the first year, but the rent is set to go up 8% per year. What would be the rent of the apartment during the 5th year of living in the apartment? Round to the nearest tenth (if necessary).

Answer 1

The rent of the apartment during the 5th year would be $1360.3.

Step-by-step explanation:

The rent of the apartment increases by 8% per year. To find the rent during the 5th year, we need to calculate the rent after each year of the lease.

1. Year 1: $1000
2. Year 2: $1000 + 8% of $1000 = $1080
3. Year 3: $1080 + 8% of $1080 = $1166.40
4. Year 4: $1166.40 + 8% of $1166.40 = $1259.71
5. Year 5: $1259.71 + 8% of $1259.71 = $1360.25

Therefore, the rent of the apartment during the 5th year would be $1360.3 (rounded to the nearest tenth).