Acar was valued at $39,000 in the year 1995. the value depreciated to $11,000 by the year 2003.
a)what was the annual rate of change between 1995 and 2003? (round to 4 decimal places)
b)what is the correct answer to part a written in percentage form?
c)assume that the car value continues to drop by the same percentage. what will the value be in the year 2007?
asap the homework is due ! : (

The annual rate of change between 1995 and 2003 is -0.1463

The annual rate of change between 1995 and 2003 is -14.63%

The value of the car in 2007 would be $5,844.24

The value of the car decreases as the years go by. This is referred to as depreciation. Depreciation is the decline in value of an asset as a result of wear and tear.

In order to determine the annual rate of change, use this formula:

g =

Where:

g = depreciation rate

FV = value of the car in 2003 = $11,000

PV = value of the car in 1995 = $39,000

n = number of years = 2003 - 1995 = 8

= -0.1463 = -14.63%

The value of car in 7 years can be determined using this formula:

FV = P (1 + g)^n

$39,000 x (1 - 0.1463)^12

$39,000 x 0.8537^12 = $5,844.24

A similar question was answered here: link

14.6328% , $5836.03

Step-by-step explanation:

Here we are going to use the formula

= 39000

r=?

= 11000

n=8

Hence

Hence r= 0.1463

In percentage form r = 14.63%

Now let us see calculate the value of car in 2003 that is after 12 years

we use the main formula again

= 39000

r=0.1463

= ?

n=12

Hence the car's value will be depreciated to $5840.34 (approx) by 2003.

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