Mr and mrs boyce bought a house for 96000 in 1995. the real estate broker indicated that houses in their area were appreciating at an average annual rate at 7%. if the appreciation remained steady at this rate, what was the value of the boyce's home in 2009?

A house is valued every year. The building is appreciating at an average annual rate of 7%. Therefore, every year the value of the house is increasing.

Start Year End Year

1995 96,000.00 1.07 102,720.00

1996 102,720.00 1.07 109,910.40

1997 109,910.40 1.07 117,604.13

1998 117,604.13 1.07 125,836.42

1999 125,836.42 1.07 134,644.97

2000 134,644.97 1.07 144,070.11

2001 144,070.11 1.07 154,155.02

2002 154,155.02 1.07 164,945.87

2003 164,945.87 1.07 176,492.08

2004 176,492.08 1.07 188,846.53

2005 188,846.53 1.07 202,065.79

2006 202,065.79 1.07 216,210.39

2007 216,210.39 1.07 231,345.12

2008 231,345.12 1.07 247,539.28

2009 247,539.28 1.07 264,867.03

Boyce's home is valued at $264,867.03 at the end of 2009.

Or it can be valued using the Future Value formula:

FV = (1+r) ^n * PV

PV = 96,000

r = 7%

n = 15 years

FV = (1 + 0.07) ¹⁵ x 96,000

FV = (1.07) ¹⁵ x 96,000

FV = 2.759 x 96,000

FV = 264,864