A server purchased at a cost of $108,000 in 2002 has a scrap value of $18,000 at the end of 5 years. Find the linear equation expressing the server's book value at the end of t years.

Question

a- V(t)=108,000
b- V(t)=108,000t-18,000t
c- V(t)=18,000t+108,000
d- V(t)=18,000t
e- V(t)=18,000t-108,000

Answer 1

each year, 1/5 of lost value (10800-18000) is subtracted.

Or, note that 18K is 1/6 of 108K. That is, in 5 years it has lost 5/6 of its value: 1/6 per year.