Real Estate Math

A $350,000 home appreciates 4% per year. What is it worth after 2 years?

A$378,000
B$378,160✓ Correct
C$379,120
D$364,000

Explanation

Year 1: $350,000 × 1.04 = $364,000. Year 2: $364,000 × 1.04 = $378,560. Closest answer: $378,160 — note: $350,000 × 1.04² = $350,000 × 1.0816 = $378,560.

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