Jason recently purchased a new truck for $34,750. The value of the truck decreases by 12% each year. how much could he sell the truck for in 7 years?(what would the value be?)
To determine the value of the truck after 7 years, we need to calculate the decrease in value for each year and subtract it from the original purchase price.
Step 1: Calculate the decrease in value for each year.
The value decreases by 12% annually, so we need to determine the value after 7 years. To find the decrease rate for each year, we multiply the purchase price by 12% (0.12).
Decrease in value per year = Purchase price × 0.12
Step 2: Subtract the decrease in value for each year from the purchase price.
We subtract the decrease in value for each year from the original purchase price to find the current value after 7 years.
Current value = Purchase price - (Decrease in value per year × Number of years)
Now, let's calculate it.
Step 1: Calculate the decrease in value for each year.
Decrease in value per year = $34,750 × 0.12 = $4,170
Step 2: Subtract the decrease in value for each year from the purchase price.
Current value = $34,750 - ($4,170 × 7)
Current value = $34,750 - $29,190
Current value = $5,560
Therefore, Jason could sell the truck for $5,560 after 7 years.
value = 34750 (.88)^7
= ...