Question

A new car costs $42,000. The value of the car depreciates by 11% each year. Write an exponential function to model

the car's value, V, after t years.

Answer 1

A = 42000(1.11)^-t

Explanation:

Using the compound interest formula

A = P(1+r)^-t

The power is negative since the car depreciates

P = $42000

rate r = 11% = 0.11

time t = t

Substitute into the formula

A = 42000(1+0.11)^-t

A = 42000(1.11)^-t

This give the required expression