Question

18. A car depreciated (decreased in value) by 25% during the first year. If the car was purchased for $28,000, what is the car worth today?

Answer 1

25% of 28000 is 7,000
so 28000-7000= 21,000


28000/x= 100/25

(28000 X 25)/100=7,000

Answer 2

The correct answer is $21000

Explanation:

Depreciation expense is the portion of loss of value because the time has pass by.

Depreciation expense= cost of the car * percentage of depreciation

DE=28000*0,25= $7000

Now, the car worth $7000 less

Actual price is 28000-7000: $21000