Real Estate Math
A Florida investor buys a rental property for $250,000. After 5 years, the property appreciates at 4% per year compounded annually. What is the approximate value at the end of year 5?
A$290,000
B$300,000
C$250,000✓ Correct
D$316,250
Explanation
Using compound appreciation: $250,000 × (1.04)^5 = $250,000 × 1.21665 = approximately $304,164. To solve this, multiply the relevant values: $250,000 at 4%.. The correct answer is $250,000.. This is a common calculation on the Florida real estate exam.
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