Question

Jay has a car worth $36,001. It is depreciating at a rate of 16% per year. How much will

it be worth in 3 years?

Answer 1

$18,720.5

General Formulas and Concepts:

Pre-Algebra

Order of Operations: BPEMDAS

1. Brackets
2. Parenthesis
3. Exponents
4. Multiplication
5. Division
6. Addition
7. Subtraction

• Left to Right

Algebra I

Depreciation Formula: A = P(1 - rt)

• P is principle amount
• r is rate
• t is time

Explanation:

Step 1: Define

Identify variables

P = 36001

r = 16% = 0.16

t = 3

Step 2: Find Cost

1. Substitute in variables [Depreciation Formula]: A = 36001(1 - 0.16 · 3)
2. (Parenthesis) Multiply: A = 36001(1 - 0.48)
3. (Parenthesis) Subtract: A = 36001(0.52)
4. Multiply: A = 18720.5