The price of a computer component is decreasing at a rate of 11% per year state whether this discrete is linear exponential if they could put a cost $50 today will cost in three years

Answer 1

If the value of the component now is Vo = 50, then the Valve V after a time period is structured for depreciation etc like so....

V = Vo(1-.11)³ or V = 50(.89)³ = 35.25 dollars

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You could also get the answer by knowing that after each year you have 89% of what you started with each year. So,

Begin Year 1 V = 50 End of Year 1 V =(.89)50 = 44.50

Begin Year 2 V = 44.50 End of Year 2 V = (.89)(44.50) = 39.605

Begin Year 3 V = 39.605 End of Year 3 V = (.89)39.605 = 35.25