Question

A vehicle purchased for $ 29800depreciates at a constant rate of 9% per year. Determine the approximate value of the vehicle 15 years after purchase.

Answer 1

The value of the vehicle would be $7,242

Explanation:

Given,

The original value of the vehicle, P = $29,800,

Rate of depreciation, r = 9% = 0.09

Time, t = 15 years,

Thus, the value of the car after 15 years,

`A=P(1-r)^t`

`=29800(1-0.09)^(15)`

`=29800(0.91)^(15)`

`=7241.64363066`

`\thickapprox \bold{\$ 7,242}`