Question

In the year 2003, a person bought a new car for $25000. For each consecutive year

after that, the value of the car depreciated by 12%. How much would the car be worth
in the year 2006, to the nearest hundred dollars?

Answer 1

Explanation:

multiply 25000×12/10

and 2003-2006 is 3 years

next steps are in the attached pic

Answer 2

• $17000

Explanation:

Given

• Initial value PV = $25000
• Depreciation rate r = 12% per year
• Time t = 2006 - 2003 = 3 years
• FV = ?

Required formula and solution

• FV = PV*(1 - r)^t
• FV = 25000*(1 - 0.12)^3 = $17036.80 ≈ $17000 (rounded)