antonio lopez plans to buy a house for $260,000. if that real - estate is expected to increase in value by 5…

antonio lopez plans to buy a house for $260,000. if that real - estate is expected to increase in value by 5 percent each year, what will its approximate value be six years from now? note: do not round intermediate calculations. round your final answer to the nearest whole number.

antonio lopez plans to buy a house for $260,000. if that real - estate is expected to increase in value by 5 percent each year, what will its approximate value be six years from now? note: do not round intermediate calculations. round your final answer to the nearest whole number.

Answer

Explanation:

Step1: Identify the compound - growth formula

The formula for compound - growth is $A = P(1 + r)^n$, where $P$ is the initial amount, $r$ is the rate of growth as a decimal, and $n$ is the number of time periods.

Step2: Convert the percentage to a decimal

The rate of growth $r = 5%=0.05$, the initial value $P = 260000$, and the number of years $n = 6$.

Step3: Substitute the values into the formula

$A=260000\times(1 + 0.05)^6$. First, calculate $(1 + 0.05)^6$. $(1 + 0.05)^6=1.05^6\approx1.3400956406$. Then, multiply by the initial value: $A = 260000\times1.3400956406\approx348424$.

Answer:

348424