Question

a new car at a cost of $25,000. The car depreciates approximately 15% of its value each year. What is the decay factor for this car?

Answer 1

The answer must be 3,750. 15% of 25,000 is 3,750. So it declines by that each year.

Answer 2

$3,750

Explanation:

the decay factor for one year. is

15/100x$2500=$3750

the remaining value, which is the current value of the car is $25,000-$3750=$21,250

every year $3750 decrease from the car's value