We have to calculate the value of the house after 10 years. We know that it was bought for $125,000 and that the value of the house appreciates 3.5 % each year. The formula is: FV = PV * ( 1 + i )^n, where FV stays for the future value, PV = $125,000, i = 3.5% = 0.035 and n = 10 ( years ). FV = 125,000 * 1.035^10 = 125,000 * 1.41 = $176,324.85. Answer: The value of the house will be $176,324.85.
