Question

a new car is sold for its sticker value of $19,400. three years later the customer returns to the car dealership to trade the car in. she is told that her car now has a value of $12,105. what is the rate of decline in the value of the car? In your final answer, include all of your calculations.

Answer 1

Answer:

100/19400*12105=62.3969072165     100-62.3969072165 = 37.60% (rounded)

Step-by-step explanation:

100% = 19'400 divide and multiply with the current value, this will give you the % deductions. Simply deduct the result from 100.

Answer 2

Answer:

copy paste version

Step-by-step explanation:

we know that the formula to calculate the depreciated value is equal to:

D = P(1-r)^t

where  

D is the depreciated value  

P is the original value  

r is the rate of depreciation  in decimal  

t  is Number of Time Periods  

In this problem we have:

P = $19,400

D = $12,105

t = 3 years

substitute in the formula above and solve for r:

$12,105 = $19,400(1-r)^3

Simplify:

(12,105/19,400) = (1-r)^3

(1-r) = 3√(12,105/19,400)

r = 1 - 3√(12,105/19,400)

r = 0.1455

Convert to percentage:

r = 14.55%