Question

The value of Melissa's Jeep is $28,000 and is depreciating at a rate of 14% per year. Use an exponential function to find the value of the Jeep after 6 years. Round to the nearest cent

Help please :/

Answer 1

Jeep value after six years is $11,327.9

Explanation:

To find the value of depreciation, we use the exponential function below;

V = I(1-r)^t

where V is the future value of the Jeep which we are to calculate

I is the initial value of the jeep which is $28,000

r is the rate of decrease or depreciation which is 14% or simply 14/100 = 0.14

t is time which is 6 years

Plugging these values into the equation, we have;

V = 28,000(1-0.14)^6

V =28,000(0.86)^6

V = 11,327.88

To the nearest cent; V = $11,327.9