A car depreciates at a rate of 15% each year. If the car’s initial value is $20,000, what will be its value after 3 years?
1. Use the formula for exponential decay:
The formula for exponential decay in this context is , where:
is the final value of the car.
is the initial value of the car ().
is the rate of depreciation as a decimal. Here, the depreciation rate is , so .
is the number of years ().
2. Substitute the values into the formula:
.
First, calculate Click "Show Answer" to reveal the answer and analysis
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