Question

The value of a piece of equipment depreciates at a rate of 20% per year. After 5 years,

the equipment is worth $98, 304. What was the original value of the equipment?

Answer 1

Depreciation is the decrease in value of an asset over time. We know that the value of the equipment depreciates at a rate of 20% per year, and after 5 years the equipment is worth $98,304. We can use this information to set up an equation to find the original value of the equipment.

Let X be the original value of the equipment.

We know that:

X * (1 - 0.20)^5 = 98304

Where (1 - 0.20) is the depreciation rate, and the exponent 5 is the number of years.

We can solve for X by using the following steps:

X * (1 - 0.20)^5 = 98304

X * (0.8)^5 = 98304

X = 98304 / (0.8)^5

X = $143,680

So, the original value of the equipment was $143,680.

Explanation: