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Let’s say that you purchased a house in January 2005 for $375,000 when Case-Shiller stood at...

Let’s say that you purchased a house in January 2005 for $375,000 when Case-Shiller stood at 135.46, and noted that the Index had climbed to 165.33 one year later. Assuming that the trend continued at the same rate, compounded yearly, what would you have been able to re-sell the property for in January 2012?

Solutions

Expert Solution

yearly rate=(165.33/135.46)-1=22.05%

hat would you have been able to re-sell the property for in January 2012

=375000*(1+22.05%)^7

=1512849.60

jeff jeffy answered 2 years ago
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