Question

A car was originally purchased in January 2010 for 27000 dollars. The car depreciates at a rate of 18% every year.

When will the car be worth half of its original value? Show your work.

Answer 1

Number of year(n) = 3.4 year (Approx)

Explanation:

Given:

Purchase value of car = $27,000

Depreciation rate per year (d) = 18% = 0.18

Future price = half of its original value = $27,000 / 2 = $13,500

Find:

Number of year(n) = ?

Computation:

`Future price =Purchase value(1-d)^n\\\\13,500=27,000(1-0.18)^n\\\\0.5=(0.82)^n\\\\n=3.444(Approx)`

Number of year(n) = 3.4 year (Approx)