A boat costs $92,000 and depreciates in value by 15% per year. How much will the boat be worth after 10 years?
18,112.45
78,200
18,941.98
69,000
Is the answer the first one? Could somebody write down the steps for me please? Thanks
each year the boat is worth .85 as much as it was
92000*.85^10 = 18112.45
You are correct. I assume you were guessing between A and C, since the other two are clearly unreasonable.
To find out how much the boat will be worth after 10 years, we need to calculate the annual depreciation and subtract it from the original cost of the boat.
Step 1: Calculate the annual depreciation:
The boat depreciates by 15% per year, which means its value decreases by 15% each year. To calculate the annual depreciation, we need to multiply the original cost of the boat by 15% or 0.15.
Annual depreciation = 0.15 x $92,000
Step 2: Calculate the value of the boat each year:
To find the value of the boat after each year, we need to subtract the annual depreciation from the original cost, and then repeat this process for each subsequent year.
Value after 1 year = $92,000 - (0.15 x $92,000)
Value after 2 years = (Value after 1 year) - (0.15 x (Value after 1 year))
And so on, until we reach year 10.
Step 3: Calculate the value of the boat after 10 years:
By following Step 2 for 10 years, you can calculate the final value of the boat.
Now, let's go through the calculations:
Value after 1 year = $92,000 - (0.15 x $92,000) = $92,000 - $13,800 = $78,200
Value after 2 years = $78,200 - (0.15 x $78,200) = $78,200 - $11,730 = $66,470
By repeating this calculation for each subsequent year, we get:
Value after 3 years = $56,499.50
Value after 4 years = $47,524.57
Value after 5 years = $39,395.89
Value after 6 years = $31,966.51
Value after 7 years = $25,101.53
Value after 8 years = $18,675.29
Value after 9 years = $12,567.00
Value after 10 years = $6,659.95
So, the boat will be worth $6,659.95 after 10 years. Therefore, the answer is not the first option provided ($18,112.45).