89.7k views
5 votes
A new car sells for $25,000. The value of the car decreases by 15% each year. What is the approximate value of the car 5 years after it is purchased?

User Telexx
by
8.3k points

2 Answers

5 votes

Answer:

Option A on edg

Explanation:

User Sajeed Kannoje
by
8.6k points
4 votes
The answer is $11,092.63.

This could be calculated using the proportion. If the value of the car decreases by 15% each year, that means that after each year the value of the car is 85% of the value from the first year.

After 1st year:
$25,000 : 100% = x1 : 85%
x1 = $25,000 · 85% ÷ 100%
x1 = $21,250

After 2nd year:
$21,250 : 100% = x2 : 85%
x2 = $21,250 · 85% ÷ 100%
x2 = $18,062.5

After 3rd year:
$18,062.5 : 100% = x3 : 85%
x3 = $18,062.5 · 85% ÷ 100%
x3 = $15,353.12

After 4th year:
$15,353.12 : 100% = x4 : 85%
x4 = $15,353.12 · 85% ÷ 100%
x4 = $13,050.15

After 5th year:
$13,050.15 : 100% = x5 : 85%
x5 = $13,050.15 · 85% ÷ 100%
x5 = $11,092.63

Therefore, the value of the car 5 years after it is purchased is $11,092.63.
User Nilesh Birari
by
8.5k points