Question

Alfred buys a car for £13960 which depreciates in value at a rate of 0.75% per year.

Work out how much Alfred's car will be worth in 12 years.

Answer 1

£12063.57

Explanation:

The value of Alfred’s car after 12 years can be calculated using the formula for exponential decay: Final Value = Initial Value * (1 - rate of depreciation)^(number of years). Plugging in the values we get: Final Value = 13960 * (1 - 0.0075)^12. Therefore, after 12 years, Alfred’s car will be worth approximately £12063.57.