What is the value of the car?

Question

Lea just bought a new car for $22,000. Assume the value of the car depreciates at a rate of 20% per year.

1.   what is the function V(t) model for the value of car ina given number of t years
2. Determine the value of the car

a. 1 year from now

b.5 years from now

Answer 1

V(t) = 22000·0.8^t

^{a. t = 1 year, V(1) = 22000·0.8 = $17600}

^{b. t = 5, V(5) = 22000·0.8^5 = $7208.96}