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Given: CH You are considering the purchase of a property today for $850,000. You plan to finance it with an 75 percent loan. The appreciation
Given: CH You are considering the purchase of a property today for $850,000. You plan to finance it with an 75 percent loan. The appreciation rate on the property valuc in the next four years is expected to be 3%, 2%, 1%, and 0%, respectively. Expected home price in the next four years will cqual ____ dollars. (Fill out the table below. Do not use the "$" symbol. Round to the nearest dollar. E.g. 100,000.) in 1 year in 2 years in 3 years in 4 years 875500 899010 901940 901940 X. (Fill out the table below. Do not use the "%" symbol. Round to 2 decimal places. E.g., if you got 12.34% put 12.34. If the value is negative, don't forget to Expected rate of appreciation in home equity (EAHE) in the next four years will equal minus sign in front of your answer!) in 1 year in 2 years in 3 years in 4 years 3.00 2.00 1.00 0.00 Over the next four years, the arithmetic average EAHE equals 6.00 percent. (Do not use the "%" symbol. Round to 2 decimal places. E.g., if you got 12.34%, put 12.34.) Over the next four years, the geometric average EAHE equals 591 percent. (Do not use the "%" symbol. Round to 2 decimal places. E.g., if you got 12.34%, put 12.34.) If you plan to buy and own a house for one year, which of these two averages (arithmetic or geometric?) is more accurate in describing the annual growth in your personal money? Your answer: arithmetic (Put one word.)
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