Question

Colin buys a tv for £720. It depreciates at a rate of 4% per year. How much will it be worth in 3 years? Give your answer to the nearest penny where appropriate.

Answer 1

£637.01

Explanation:

Each year, the value of the TV is multiplied by (1 -4%) = 0.96. Multiplying by this value each year for 3 years will mean the value is ...

£720×0.96³ ≈ £637.01

The TV will be worth £637.01 in 3 years.