Answer:
D. $4000
Step-by-step explanation:
Initial value of the car is given $5000
Salvage value given $500
Useful life of car given is 5 years
Formula
Depreciation for n years is given as:
[tex]d_{n}= \textrm{Salvage value}\times \textrm{Number of years used}[/tex]
[tex]d_{n}=\textrm{Salvage Value}\times n[/tex]
Plug in 2 for n. This gives,
[tex]d_{2}=500\times 2=1000[/tex]
∴ Depreciation after 2 years =$ 1000
Value of car after 2 years = Initial value - Depreciation after 2 years
Value of car after 2 years = [tex] 5000- 1000=4000[/tex]
Therefore, value of car after 2 years = $ 4000
