Question

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).

Answer 1

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 :

`A = P( 1 + (r)/(100))^t\\\\A = 1700( 1 + (9)/(100) )^(12)\\\\A = \$4781.53`

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