Check Your Understanding Appreciation & Depreciation

Is the value of a house increasing over time an example of appreciation or depreciation?

• Appreciation

• Depreciation

• Neither

Tags

CCSS.HSF-IF.C.8B

Is the annual decrease in the value of a car an example of appreciation or depreciation?

• Appreciation

• Depreciation

• Neither

True or False. Over time the value of a house can both appreciate and depreciate.

• True

• False

Answer explanation

House prices tend to increase and decrease based on the market.

Study each of the following graphs. Which graphs model appreciation?

• Graph A

• Graph B

• Graph C

• None of these

A collectible comic book that is currently worth $45 is expected to double in value every year

over the next decade. Will the comic book appreciate or depreciate over the next decade?

• Appreciate

• Depreciate

• Neither

Answer explanation

Expected to double, means the amount increases by multiplying it by 2.

Use your spreadsheet to help you determine the value of the comic book 8 years from now?

• 720

• $11 520

Tags

CCSS.HSF.BF.A.2

In how many years will the comic book be worth $720?

• 2 years

• 4 years

• 6 years

• 10 years

Over the next decade, is the relationship between time and the value of the comic book linear or non-linear? Explain.

• Linear because it grows by a constant amount each year

• Nonlinear, because it doubles the new amount each year, so its growth is not constant

• Linear, because an increasing value produces a straight line graph

• Neither because it wil both increase and decrease over the years.

Tags

CCSS.8.F.A.3

This graph represents the value of a machine over 7 years. Does the machine appreciate or depreciate over time? Explain.

• Appreciation

• Depreciation

• Neither

• Both

What is the value of the machine when it is first purchased? Use the graph to find your answer.

• $10 000

• $15 000

• $20 000

• $45 000

Tags

CCSS.HSF.LE.B.5