Question

You rent an apartment that costs

$
1300
$1300 per month during the first year, but the rent is set to go up 9.5% per year. What would be the rent of the apartment during the 11th year of living in the apartment? Round to the nearest tenth (if necessary).

Answer 1

$3221.70 per month.

Explanation:

After 1 year the monthly rate is 1300 * 1.095

= $1423.50 - that is during the second year.

The third years rent will be 1423.50 * 1.095 ( = 1300 * 1.095^2 - and so on every year.

During the 11th year it will be 1300 * 1.095^10

= $3221.70 per moth.

=

Answer 2

$2,660

Explanation:

9.5% of 1300 is 123.5

So to figure out what the rent would cost in 11 years, we just have to multiply 123.5 by 11.

123.5 × 11 = 1358.5

We can then add that number to 1300.

1358.5 + 1300 = $2658.5

Then we round.

Your final answer would be:

$2,660