Question

A car was purchased for $3,495 and will depreciate 20% of the original price each year.

Answer 1

Original price: $3,495
Yearly price decrease = 0.2 x 3,495 = $699 per year
Let y be the value of the car and x be the number of years:

y = 3495 - 699x

After 5 years,
y = 3495 - 699(5)
= $0

In order to solve this problem, we set up a linear equation where the variables were the value of the car and the time passed since purchase. The claim that the car will not be anything is true to an extent because its price has dropped to 0 according to our function; however, practically, a car cannot be $0 so it will be worth at least something, however smaller than its original price.