Question

You purchased a new car for 17,999 in the year 2015. It is now 2020 and you want to sell your car for a fair price. If your car depreciated 15% each year, how much would your car be worth right now?

Answer 1

Answer:

$7,986.25

Step-by-step explanation:

We can use the following formula to solve:

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

P = principal value

r = rate (decimal)

t = time (years)

First, change 15% into a decimal:

15% -> $\frac{15}{100}$ -> 0.15

Since 2015 and 2020 are 5 years apart, we will use 5 for t. Now, plug the values into the equation:

$A=17,999(1-0.15)^5$

$A=7,986.25$

Your car would be worth $7,986.25