Question

Mrs. Stevens bought a Mustang for $25,000. If it depreciates at a rate of 15% a year, what is the price of the car after a year? What is the depreciation amount?

a. After a year: $21,250, Depreciation: $3,750
b. After a year: $21,250, Depreciation: $3,750
c. After a year: $21,250, Depreciation: $3,750
d. After a year: $21,250, Depreciation: $3,750

Answer 1

The price of the car after a year is $21,250 and the depreciation amount is $3,750.

Step-by-step explanation:

To find the price of the car after a year, we need to calculate the depreciation amount and subtract it from the original price of $25,000. Depreciation is the decrease in value over time. Since the car depreciates at a rate of 15% per year, we can calculate the depreciation amount as:

Depreciation Amount = Original Price x Depreciation Rate = $25,000 x 0.15 = $3,750

To find the price after a year, we subtract the depreciation amount from the original price: $25,000 - $3,750 = $21,250. Therefore, the price of the car after a year is $21,250. The correct answer is option a: After a year: $21,250, Depreciation: $3,750