If an Average Home in Your Town Currently Costs $250,000

question 156

Multiple Choice

If an average home in your town currently costs $250,000, and house prices are expected to grow at an average rate of 3 percent per year, what will a house cost in eight years?

• A) $255,033.41
• B) $255,043.97
• C) $314,928.01
• D) $316,692.52

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Definitions:

Variable Cost

Charges that adjust according to the volume of goods produced or services provided.

Output

The total quantity of goods or services produced by a firm or industry during a specific period.

Labor

Describes the use of human physical and mental capabilities in creating products and services.

Average-Variable-Cost Curve

The average-variable-cost curve graphs the unit variable cost against the level of output, typically showing a U-shaped curve due to economies and diseconomies of scale.