Question

A new car is purchased for 17600 dollars. The value of the car depreciates at 11.75% per year. What will the value of the car be, to the nearest cent, after 11 years?

Answer 1

Answer:

Step-by-step explanation:

For compound interest, we use the formula A = P(1 + r/n)^{nt}, where A is the amount, P is the principle, r is the rate, n is the number of times compounded per period of time, and t is the time.

We can alter this for a decrease. Instead of adding r/n to 1, we can substract it:

A = 17,600 * (1 - 0.01175 / 1)^{1 * 11} = 15,454.24

After 11 years, the car will be worth $15,454.24