Question

A powerful computer is purchased for $2500, but loses 18% of its value each year. How much will it be

worth 4 years from now?

Answer 1

$1130.30

Explanation:

Step one:

given data

cost of computer= $2500

rate of loss per year= 18%

time t= 4 years

Step two:

let us computer the loss per year

Year 1 loss

worth= 2500- 2500*0.18

worth= 2500-450

worth= $2050

Year 2 loss

worth= 2050- 2050*0.18

worth= 2050-369

worth= $1681

Year 3 loss

worth= 1681- 1681*0.18

worth= 1681-302.58

worth= $1378.42

Year 4 loss

worth= 1378.42- 1378.42*0.18

worth= 1378.42-248.1156

worth= $1130.30