Question

Lydia bought a car for $20,000. It is expected to depreciate at a continuous rate. What will be the value of the car in 2 years? Use k = 0.105 and round to the nearest dollar.

Answer 1

Answer:

$\ 16,021$  

Step-by-step explanation:

we know that

The  formula to calculate the depreciated value  is equal to  

$V=P(1-k)^{x}$  

where  

V is the depreciated value  

P is the original value  

k is the rate of depreciation  in decimal  

x  is Number of Time Periods  

in this problem we have  

$P=\ 20,000\\k=0.105\\x=2\ years$

$V=\ 20,000(1-0.105)^{2}=\ 16,020.50$  

round to the nearest dollar

$\ 16,020.50=\ 16,021$