Question

The initial value of your new car was $20,000. After one year, the value of the car is $18,000.What will the approximate value of the car be in 7 years?$8,000.00O $8,565.94$9,000.00$9,565.94

Answer 1

The approximate value of the car after 7 years is;

`\text{ \$9,565.94}`

Step-by-step explanation:

Given that the initial value of the car is;

`P=\text{ \$20,000}`

after 1 year its new value is;

`\text{ \$18,000}`

The rate of depreciation is;

`r=(18000)/(20000)=0.9\text{ per year}`

After 7 years the value of the car can be calculated using the formula;

`F=P(r)^t`

where t equals 7 years.

substituting the values;

`\begin{gathered} F=20000(0.9)^7 \\ F=\text{ \$9,565.94} \end{gathered}`

Therefore, the approximate value of the car after 7 years is;

`\text{ \$9,565.94}`