Question

A sailboat depreciates at 15% of its original value each year. If the sailboat was $9500 at its time of purchase, what is the value of the sailboat after 7 years?

Answer 1

After 7 years, the valu of the boat = 9500(1 - 0.15)^7 = 9500(0.85)^7 = $3,045.48

Answer 2

Answer: After 7 years, the value of the sailboat is $3045.49.

Explanation:

Since we have given that

Original value of the sailboat = $9500

Depreciation rate = 15%

Number of years = 7

As we know the formula for "Compound Interest "i.e

`A=P(1-(r)/(100))^n`

where,

A denotes Amount

P denotes original value

r denotes rate of depreciation,

n denotes number of years.

So, our equation becomes ,

`A=9500(1-(15)/(100))^7\\\\A=9500(1-0.15)^7\\\\A=9500(0.85)^7\\\\A=\$3045.49`

Hence, after 7 years, the value of the sailboat is $3045.49.