Question

A car is purchased for $25,000 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

BV= $6,871.18

Explanation:

First, write equation for book value at the end of year 1;

BV= 25,000* (1-0.0825)^15

With the above equation, we can find book value at the end of year 15;

BV= 25,000* (1-0.0825)^15

BV=25000*0.274847

BV= $6,871.18