Buying your own home is often mentioned as "the best investment you can make." In 1930, the average home sale price was $3,845. By 1990, the average home sale price had risen to $123,000
What was the average annual rate of change in the price of houses over this time period?
A) 3.42% per year
B) 5.95% per year
C) 10.12% per year
D) 12.36% per year
Answer: B
Explanation: B) r = (FV/PV)1/n - 1 = ($123,000/$3,845)1/60 - 1 = 5.95% per year
MODE = END
INPUT 60 ? -3,845 0 123,000
KEY N I/Y PV PMT FV
CPT 5.95
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