Question

A t the end of 2000 a
house was valued at $375,000 and then increased in value by 5.00% on an average,
each year 2001 through 2006. Its value did not change in 2007, but then
decreased by 8.00% on an average each year 2008 through 2011. What was its
value at the end of 2011?

Answer 1

$Value of house at end of year 2000 : \ 375000 \\ Value at the end of 2001 :  \frac {(100+5)}{100} \* \ 375000 \\ \\  \= 1.05 * 375000 \\ Value at the end of 2002 : 1.05 * 1.05 * \ 375000 \\ value at the end of 2006 : 1.05^{6} * \ 375000 \\ Value\ at\ the\ end\ of\ 2008 : \frac{(100-8)}{100} \* 1.05^{6} * \ 375000 \\ \\ Value\ at\ the\ end \of\  2011 = 0.92^{4} 1.05^{6} \ 375000 \\ = 0.96005 * \ 375000 \\ = \ 360013.16$

ANSWER is $360013.16