Question

A product initially with a value of $22,000 has been depreciating at 6% p.a. over 2 years. What is it's current value?

Answer 1

$19,439.20

1) According to this, we can write an exponential equation to find that. SInce it's a long period to calculate linearly.

2) So we can write:

$\begin{gathered} C=22,000(1-0.06)^2 \\ C=22,000(0.94)^2 \\ C=19439.2 \end{gathered}$

3) Therefore the Current Value is $19,439.20