Question

A car was valued at $35,000 in the year 1993. The value depreciated to $14,000 by the year 2005 . (A) what was the annual rate of change between 1993 and 2005

Answer 1

The annual rate of change in the value of the car between 1993 and 2005 was -5% per year.

Step-by-step explanation:

To find the annual rate of change in the car's value between 1993 and 2005, we need to use the formula for annual depreciation rate, which is:

Annual Depreciation Rate = (Value at End - Initial Value) / (Number of Years * Initial Value)

Plugging in the values from the question, we get:

Annual Depreciation Rate = ($14,000 - $35,000) / ((2005 - 1993) * $35,000)

Annual Depreciation Rate = (-$21,000) / (12 * $35,000)

Annual Depreciation Rate = (-$21,000) / $420,000

Annual Depreciation Rate = -0.05 or -5%

Therefore, the annual rate of change in the value of the car was -5% per year.