Question

A new car is purchased for 20300 dollars. The value of the car depreciates at 8.75% per year. What will the value of the car be, to the nearest cent, after 12 years?

Answer 1

Answer:

$6,765.35.

Step-by-step explanation:

Here we have to use the rate of depreciation, the initial value and the total time to find the final value with this formula

$A=A_{0}(1-r)^{t}$

Where $A$ is the final value, $A_{0}$ is the initial value, $r$ is the rate of depreciation and $t$ is the time.

Replacing all values, we have

$A=20300(1-0.0875)^{12}$

$A=6765.35$

Therefore, after 12 years the car will value $6,765.35.