Question

A new car is purchased for 25000 dollars. The value of the car depreciates at 8.25% per year. What will the value of the car be, to the nearest cent, after 15 years?

Answer 1

A=25000(1-0.0825)^15
A=6,871.18

Answer 2

Answer: $6871.18

Step-by-step explanation:

The equation for depreciation is given by :-

$y=A(1-r)^x$, where A is the initial value and r is the rate of depreciation in x years.

Given: The initial value of car = $25,000

The rate of depreciation of car = 8.25%=0.0825

Now, the value of car after 15 years will be given by :-

$y=25,000(1-0.0825)^{15}\\\\\Rightarrow y=25000(0.9175)^{15}\\\\\Rightarrow y=\ 6871.17647028\approx \ 6871.18$

Hence, the value of car after 15 years= $6871.18