Question

The general equation for depreciation is given by y = A(1 – r)t, where y = current value, A = original cost, r = rate of depreciation, and t = time, in years. A car was purchased 6 years ago for $25,000. If the annual depreciation rate is 11%, which equation can be used to determine the approximate current value of the car?
A. y=25,000(.89)^6
B. y=(25,000 x .11)^6
C. y=(25,000 x .89)^6
D.y=25,000(.11)^6

note: the 'x' is a multiplication symbol

Answer 1

Answer:

A. y=25,000(.89)^6

Step-by-step explanation:

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Answer 2

Analyzing the given values and the given equation, we have the following:
A = $25,000
r = 0.11
t = 6

The equation has the form:
y = A (1-r)^t
Plugging in the given values into the equation,
y = $25,000 (1 - 0.11)^6
y = $25,000 (0.89)^6

Therefore, the answer is
A. y=25,000(.89)^6