The Freeman family bought a new apartment five years ago for $80,000. The apartment is now worth $199,200. Assuming a steady rate of growth, what was the yearly rate of appreciation? 19.1%

20%

23%

24.9%

Given that the apartment was worth 80k 5 years ago, find out the rate of appreciation for the apartment now worth 199.2k.

Work:

Subtract the former from the new amount.

199.2 - 80 = 119.2

Divide the difference by the years passed.

119.2/5 = 23.84

This means that the price of the apartment increased by 23,840 each year.