Question

A car is purchased for $27,000 . After each year, the resale value decreases by 30% . What will the resale value be after 3 years? Use the calculator provided and round your answer to the nearest dollar.

Answer 1

The multiplier for decreasing by 30% is 0.70. To get our answer we times the price by the multiplier to the power of the amount of years:

27,000 x 0.70³   ( it's to the power of 3 because of the three years)
= $9,261

Answer 2

27000 x .3 = 8100
8100 x 3 = 24300
27000 - 24300 = 2700