Question

A car was purchased for $24,000. Its value is predicted to decay exponentially, decreasing by 13% each year. Write an equation to determine the value of the car.

Answer 1

y= P(0.87)^t

Explanation:

Given data

Price P= $24,000

Rate of decay in price= 13%

The expression in terms of y, p and t is

y=P(1-r)^t

y= P(1-0.13)t

y= P(0.87)^t