Question

The original price of a tractor was $55,000. The value decreases in value at a

steady rate of 11% per year. What will the tractor be worth in 8 years?
A) $21,651.24
B) $65,487.22
C) $45,591.35
D) $12,536.25

Answer 1

• Answer:

A) $21,651.24

• Explanation:

x = p(1 - r)ⁿ

p = $55000

r = 11% = 0.11

n = 8 years

x = $55000(1 - 0.11)⁸

= $55000ₓ0.89⁸

= $55000ₓ0.39365888057

= $21651.24