Question

Dwayne purchased a computer from Techtronic's, Inc. for $2,600 in 2007. The rate of

depreciation is 7%. Which would be the best estimate for the value of the computer in

2010?

Answer 1

`\$2091.3`

Explanation:

Let P denotes initial value of the product, r% is the annual depreciation rate and t denotes time period.

Depreciation (d) =
`P(1-(r)/(100))^t`

Put
`P=\$2,600,\,r\%=7\%,\,t=3` years

Therefore,

`d=P(1-(r)/(100))^t\\\\=2600(1-(7)/(100))^3 \\\\=2600((93)/(100))^3\\\\=\$2091.3`