Question

A vehicle purchased for $20,700 depreciates at a constant rate of 7%. Determine the approximate value of

the vehicle 15 years after purchase. Round to the nearest whole dollar.
1 pt

Answer 1

Depreciation at a constant percent is exponential decay:V(t) = V0·(1-rate)tV(t) is the value at year t (we want t = 14 years)V0 is the starting value = $20,700rate is the depreciation rate expressed as a decimal = 0.05t = years = 14V(14) = $20700·(1 - 0.05)14Use your calculator to get the answer. Round your answer to the nearest cent, The units are $$.

Explanation: