Question

A new car that sells for $19,000 depreciates (decreases in value) 21% each year. What is the decay factor, b? 0.79 0.21 79 21

Answer 1

Answer: 0.79

Step-by-step explanation:

Given: The cost price of car = $19,000

The rate of depreciation = 21 % = 0.02

The exponential decay equation (depreciation) is given by :-

$y=Ab^x$, where A is the initial amount and b is the decay factor for x years such that $b=(1-r)$, where r is the rate of decay.

If we substitute the value of r , we get

The decay factor =$b = (1-0.21)=0.79$

Answer 2

The decay factor is 0.21 ((: