Answer:
$5904
Explanation:
• The purchase value of the car = $21,500
,
• The rate of depreciation = 35%.
To find the resale value of the car after a certain number of years, we use the depreciation formula below:
[tex]A(t)=A_o(1-r)^t[/tex]
• The initial value, Ao = 21,500
,
• The rate, r = 35% =0.35
,
• The time, t (in years) = 3
Substitute these values into the formula:
[tex]\begin{gathered} A(3)=21500(1-0.35)^3 \\ =21500(0.65)^3 \\ =5904.44 \\ \approx\$5904 \end{gathered}[/tex]
The resale value of the car after 3 years is $5904 (correct to the nearest dollar).
