Question

A certain smart phone depreciates at a rate of 21 percent each year. Assuming the current value of the phone is $700.00, create an exponential decay formula to model the depreciation and determine the value of the phone after three years. Round your answer to the nearest cent.(1 point)ResponsesAfter three years, the phone will be valued at $259.00.After three years, the phone will be valued at $259.00.After three years, the phone will be valued at $553.00.After three years, the phone will be valued at $553.00.After three years, the phone will be valued at $6.48.After three years, the phone will be valued at $6.48.After three years, the phone will be valued at $345.13.

Answer 1

Let V(t) be the value after t years. The annual decay factor is 1 − 0.21 = 0.79, so

V(t) = 700(0.79)^t.

After 3 years:
V(3) = 700(0.79)^3 ≈ 700(0.493039) ≈ $345.13.