A Nevada property was purchased for $320,000. It appreciated 4% per year for 3 years. What is the approximate current value?

Explanation

Compound appreciation: Year 1: $320,000 × 1.04 = $332,800. Year 2: $332,800 × 1.04 = $346,112. Year 3: $346,112 × 1.04 = $359,956 (approximately $360,038 depending on rounding). Simple appreciation would give $320,000 + (3 × $12,800) = $358,400, but compound appreciation is more accurate. The Nevada exam may test both methods — compound appreciation yields slightly higher values over time.