The value of items such as land and collectorâ€™s items usually increase in value over time. This increase in value is called appreciation. The calculations for appreciation are identical to those for compound interest. 
EXAMPLE
A cricket ball signed by Sir Garfield Sobers was originally valued at $1,050. What is the value of the ball 10 years later if it appreciates at a rate of 12% per annum?
SOLUTION
where is the annual rate of interest.

Try the exercise below to practise your newly developed skill.