Question

question
moussa has a collection of vintage action figures that is worth $390. if the collection appreciates at a rate of 3% per year, which equation represents the value of the collection after 3 years?
answer

• ( v = 390(1 + 0.03)(1 + 0.03) )
• ( v = 390(1.3)^3 )
• ( v = 390(1.03)^3 )
• ( v = 390(1 - 0.03)^2 )

Explanation:

Step1: Recall compound appreciation formula

The formula for compound appreciation is $V = P(1 + r)^t$, where $P$ is principal value, $r$ is annual rate, $t$ is time in years.

Step2: Identify given values

$P = 390$, $r = 0.03$, $t = 3$

Step3: Substitute values into formula

$V = 390(1 + 0.03)^3 = 390(1.03)^3$

Answer:

$V = 390(1.03)^3$ (the third option)