Question

Jason bought a car for $12500. According to the insurance company, the value of the car depreciates by 7% each year. What will the value of car be 5 years after Neil purchased it? Round to the nearest hundredth, if necessary. Do not include the $ sign in your answer.

Answer 1

8696.10

Explanation:

If a car depreciates by 7% each year, this means that 7% of its value that year is subtracted from its previous value. In other words, you can multiply its value by (1-0.07)=0.93.

`12500\cdot 0.93^5\approx 8696.10`. Hope this helps!