Joe wants to rent an apartment with an initial monthly rent of $1,400. He has been told that the landlord raises the rent 1.25% each year.

Cheyanne Leigh

Cheyanne Leigh

Answered question

2021-09-13

Joe wants to rent an apartment with an initial monthly rent of $1,400. He has been told that the landlord raises the rent 1.25% each year. Set up an exponential function that models this situation. Calculate the rent after 12 years. Round to the nearest dollar.

Answer & Explanation

Elberte

Elberte

Skilled2021-09-14Added 95 answers

An exponential function is of the form y=bax1 with b the initial amount, a the interest rate increased by 1 and x the number of years.
y=1400(1+0.0125)x1=1400(1.0125)x1
Replace x with 12
y=1400(1+0.0125)121=1400(1.0125)11=1604.99

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