Question

A family purchases a car for $11,000 which depreciates about 16% annually. How much is the car worth after 4 years

Answer 1

$ 5476.58 ( approx )

Explanation:

Given,

The initial value of the car, P = $ 11,000,

Rate of changing, r = - 16% = -0.16,

Time, t = 4 years,

Hence, the value of the car would be,

`A=P(1-r)^t=11000(1-0.16)^4`

`=11000(0.84)^4`

`=\$ 5476.58496`

`\approx \$ 5476.58`