Question

John buys a new truck for $25,000. The truck will depreciate at an average rate of 9.5% per year. What will the truck be worth in 5 years? Round to the nearest dollar.

Answer 1

$13,125

Explanation:

To find out the total percent it will drop, you do 9.5%*5, which is 0.475, or 47.5%

Next, you have to find 47.5% of 25k, which is 47.5%*25000

=.475*25000

=11,875

So it will drop a total of 11,875 dollars, so we have to do 25k-11875

25000-11875=13125

Therefore, the truck will be worth $13,125 in 5 years.