exponential growth and decay

Question

A family buys a car for $20,000. The value of the car decreases about 20% each year. After 6 yr, the family decides to sell the car. Should they sell it for $4000?

Answer 1

Rate of decay formula

 

Y=A(1-r)^x

A=Init amount

R=rate of decay

X=number of decays

 

Y=20000(1-.20)^6

Y=$5242.88

 

So no the car is worth more than $4000