Question

The value of a new $5400 sailboat decreases 10% per year. Find its value after 5 years. Round to the nearest penny.

Answer 1

FV= $3,352.98

Explanation:

Giving the following information:

Initial investment (PV)= $5,400

Number of periods (n)= 5 years

Interest rate (i)= 10%

To calculate the future value (FV), we need to use the following formula:

FV= PV / (1 + i)^n

FV= 5,400 / (1.1^5)

FV= $3,352.98