Question

Will buys a watch for £1020.

It decreased in value by 3.5% per year for 4 years, then increased in value by 7.5% per year for 3 years.

Find the new value of the watch.

Answer 1

To find the new value of the watch, we need to apply the percentage changes to the original price of £1020. We can use the formula:

new value = old value * (1 + percentage change / 100)

For the first 4 years, the watch decreased in value by 3.5% per year. So, we can multiply £1020 by (1 - 3.5 / 100) four times:

£1020 * (1 - 3.5 / 100) * (1 - 3.5 / 100) * (1 - 3.5 / 100) * (1 - 3.5 / 100)

This gives us £873.76, which is the value of the watch after 4 years.

For the next 3 years, the watch increased in value by 7.5% per year. So, we can multiply £873.76 by (1 + 7.5 / 100) three times:

£873.76 * (1 + 7.5 / 100) * (1 + 7.5 / 100) * (1 + 7.5 / 100)

This gives us £1079.74, which is the new value of the watch after 7 years.

Therefore, the new value of the watch is £1079.74.