A computer is purchased at 2000$. After each year, the resale value decreases by 25%. What will the resale value be after 3 years?
What is
2000(.75)^3 ?
To find the resale value after 3 years, you need to apply the decrease of 25% for each year.
Let's start by calculating the resale value after the first year.
Subtracting 25% (or 0.25) from 100% (or 1) gives us 0.75, which represents the amount of value retained after the first year.
The resale value after the first year is then:
2000 * 0.75 = 1500$
Next, we can calculate the resale value after the second year using the same process.
Again, subtracting 25% (0.25) from 100% (1), we find that 0.75 is the amount of value retained after the second year.
The resale value after the second year is:
1500 * 0.75 = 1125$
Now, to calculate the resale value after the third year, we repeat the process once more.
Subtracting 25% (0.25) from 100% (1), we find that 0.75 is the amount of value retained after the third year.
The resale value after the third year is:
1125 * 0.75 = 843.75$
Therefore, the resale value of the computer after 3 years will be approximately 843.75$.