Question

A sofa depreciates at 20% of its original value each year. If the sofa was $349 at its time of purchase, what is the value of the sofa after 4 years? Round your answer to the nearest cent.

Answer 1

Answer:

$142.95

Step-by-step explanation:

Given Original value of the sofa = $349

Rate of depreciation each year = 20%

Number of years = 4

To find the value of the sofa after 4 years use depreciation formula:

If the constant decrease in population be R% per annum. Then the population after n years is  $P \times\left(1-\frac{R}{100}\right)^{n}$

$349 \times\left(1-\frac{20}{100}\right)^{4}=349 \times\left(\frac{100-20}{100}\right)^{4}$  

                           $=349 \times\left(\frac{80}{100}\right)^{4}$ 

                           $=349 \times\left(\frac{4}{5}\right)^{4}$

                           = 142.9504

                           = 142.95 (Nearest cent)

Hence, the value of sofa after 4 years is $142.95.