Question

the value of a car is $8,400.if it decreases by 5%/ this year and then by 5% of rhe new price next year, how much will it be worth two years from now?

Answer 1

The value of a car is $8,400

it decreases by 5% this year.

Price of the car after 1st year:

$\begin{gathered} 8,400\times(1-\frac{5}{100}) \\ 8,400\times(1-0.05) \\ 8,400\times(0.95) \\ 7,980 \end{gathered}$

So, the price of the car after the 1st year will be $7,980.

Price of the car after 2nd year:

Now you will use $7,980 as a starting price.

$\begin{gathered} 7,980\times(1-\frac{5}{100}) \\ 7,980\times(1-0.05) \\ 7,980\times(0.95) \\ 7,581 \end{gathered}$

So, the price of the car after the 2nd year will be $7,581.

Therefore, the car will be worth $7,581 two years from now.