Question

Time (in years)

Dan bought a new computer for $900. Each year, the value of
the computer decreased by 25% of the previous year's value. At
this rate, what can Dan expect the approximate value of the
computer to be after 8 years?
A
$84
B
$90
C
$100
D
$113

Answer 1

B) $90

Explanation:

To work out the value of the computer after 8 years you would first have to convert the percentage into a decimal. To achieve this you would divide the percentage of 25 by 100, which gives you 0.25. This is because percentages are out of 100. The next step is to minus 0.25 from 1, which gives you 0.75. This is because the value of the computer is diminishing. Then you would multiply 900 by 0.75 to the power of 8, which gives you 90. You would multiply to the power of 8 as the percentage decrease will need to take place 8 times due to it being annual.

1) Divide 25 by 100.

`25/100=0.25`

2) Minus 0.25 from 1.

`1-0.25=0.75`

3) Multiply 900 by 0.75 by the power of 8.

`900*0.75^(8) =90.1`

4) Round to the nearest whole number.

90