Question

Terrence buys a new car for $20,000. The value of the car depreciates by 15% each year. If f(x) represents the value of the car after x years, which function represents the car’s value?

f(x) = 20,000(0.85)x
f(x) = 20,000(0.15)x
f(x) = 20,000(1.15)x
f(x) = 20,000(1.85)x

Answer 1

f(x) = 20,000(0.85)^x

Reason: a 15% yearly depreciation leaves 85% of the value each year, so multiply by 0.85 for each year (0.85^x).