Every year that a car is on the road it loses value. If a car loses 15 percent of it value each year and its beginning value is $24,500, what will the value of the car be after five years?
A. $10,870.78
B. $49,278.25
C. $9240.25
D. $12,789.15
To find the value of the car after five years, we need to calculate the value after each year of depreciation.
After one year: $24,500 - 15%($24,500) = $24,500 - $3,675 = $20,825.
After two years: $20,825 - 15%($20,825) = $20,825 - $3,123.75 = $17,701.25.
After three years: $17,701.25 - 15%($17,701.25) = $17,701.25 - $2,655.19 = $15,046.06.
After four years: $15,046.06 - 15%($15,046.06) = $15,046.06 - $2,256.91 = $12,789.15.
After five years: $12,789.15 - 15%($12,789.15) = $12,789.15 - $1,918.37 = $10,870.78.
Therefore, the value of the car after five years would be $10,870.78.
The correct answer is A. $10,870.78.