The value of a new car purchased for $28,000 decreases 8% per year. Write an exponential decay model for the value of the car. Use the model to estimate the value after 5 years.

Question

The value of a new car purchased for $28,000 decreases 8% per year.  Write an exponential decay model for the value of the car.  Use the model to estimate the value after 5 years.

Mgraph · Answer

Let P(n) is the price after n years, then P(n)=28000*0.92^n P(5)=28000*0.92^5=18454