Question

The value of a vehicle depreciates at the rate of 15% per year. What will the value be after 3 years if it was purchased for 45,000?

Answer 1

The value of the vehicle after 3 years would be approximately $27,636.63.

Step-by-step explanation:

To find the value of the vehicle after 3 years, we can use the formula for compound interest:

V = P(1 - r)^n

Where:
V is the future value
P is the present value ($45,000)
r is the interest rate (15% or 0.15)
n is the number of years (3)

Plugging in the values, we get:

V = 45,000(1 - 0.15)^3 = 45,000(0.85)^3 = 45,000(0.614125) ≈ $27,636.63