Question

A bicycle depreciates at a rate of 15% therese bought a bicycle for $250. How much should it be worth 6 years later ?

Answer 1

94.29

Explanation:

we know that

The formula to calculate the depreciated value is equal to

where

V is the depreciated value

P is the original value

r is the rate of depreciation in decimal

x is Number of Time Periods

in this problem we have

Answer 2

`\$94.29`

Explanation:

we know that

The formula to calculate the depreciated value is equal to

`V=P(1-r)^(x)`

where

V is the depreciated value

P is the original value

r is the rate of depreciation in decimal

x is Number of Time Periods

in this problem we have

`P=\$250\\r=15\%=0.15\\x=6\ years`

`V=\$250(1-0.15)^(6)`

`V=\$250(0.85)^(6)=\$94.29`