Question

Don bought his car for $20,350. It is expected to depreciate an average of 11% each year during the first 5 years.
What will the approximate value of his car be in in 5 years?

Answer 1

Answer:

The approximate value of Don car be in 5 years is $ 11364 .

Step-by-step explanation:

The exponential decreases function is defined as

$y = a (1 - r)^{t}$

Where a is the initial value , r is the rate of interest in the decimal form and t is the time in years .

As given

Don bought his car for $20,350.

It is expected to depreciate an average of 11% each year during the first 5 years.

a = $ 20350

11% is written in the decimal form

$= \frac{11}{100}$

= 0.11

r = 0.11

t = 5 years

Put all the values in the function

$y = 20350(1 - 0.11)^{5}$

$y = 20350(0.89)^{5}$

$y = 20350\times 0.558406$

y = $ 11363 .5621

y = $ 11364 (Approx)

Therefore the approximate value of Don car be in 5 years is $ 11364 .