Answer:
$6770.65
Step-by-step explanation:
The purchase price is $20,300
The depreciation rate is 9.5% per year, in decimal, that is:
9.5/100 = 0.095
We want to find the value of car after 11 years. We will use the compound decay formula:
[tex]F=P(1-r)^t[/tex]
Where
F is the future value (what we want to find after 11 years)
P is the present value, purchase price (20,300 given)
r is the rate of depreciation (r = 0.095)
t is the time in years ( t = 11)
Substituting, we solve for F:
[tex]F=P(1-r)^t\\F = 20,300(1-0.095)^{11}\\F=20,300(0.905)^{11}\\F=6770.65[/tex]
Thus,
The value of the car would be around $6770.65, after 11 years
