Question

A new car is purchased for 17000 dollars. The value of the car depreciates at 12.25% per year. What will the value of the car be, to the nearest cent, after 14 years?

Answer 1

Answer:

$P(t=14) = 17000 (1-0.1225)^{14}= 2728.404$

Step-by-step explanation:

for this case we have the following model for the cost of the car:

$P(t) = P_o (1-r)^t$

Where $P_o$ is the initial amount on this case 17000, t the amount of years after the initial year and r the depreciation rate on this case:

$r= \frac{12.25}{100}=0.1225$

And for t =14 we can replace into the equation and we got:

$P(t=14) = 17000 (1-0.1225)^{14}= 2728.404$