Question

A sailboat depreciates at 15% of its original value each year. If the sailboat was $9500 at its time of purchase, what is the value of the sailboat after 7 years?

Answer 1

Answer: After 7 years, the value of the sailboat is $3045.49.

Step-by-step explanation:

Since we have given that

Original value of the sailboat = $9500

Depreciation rate = 15%

Number of years = 7

As we know the formula for "Compound Interest "i.e

$A=P(1-\frac{r}{100})^n$

where,

A denotes Amount

P denotes original value

r denotes rate of depreciation,

n denotes number of years.

So, our equation becomes ,

$A=9500(1-\frac{15}{100})^7\\\\A=9500(1-0.15)^7\\\\A=9500(0.85)^7\\\\A=\ 3045.49$

Hence, after 7 years, the value of the sailboat is $3045.49.

Answer 2

After 7 years, the valu of the boat = 9500(1 - 0.15)^7 = 9500(0.85)^7 = $3,045.48