Answer:
The value of the car is $18634.
Step-by-step explanation:
Given : The original purchase price of a car is $14,000. Each year, its value depreciates by 10%. Three years later after its purchase.
To find : What is the value of the car?
Solution :
To find the value of car we apply compound interest formula,
[tex]A=P(1+r)^t[/tex]
Where, A is the amount
P is the principal P=$14000
r is the rate of depreciates r=10%=0.1
t is the time t=3 years
Substitute the value in the formula,
[tex]A=14000(1+0.1)^3[/tex]
[tex]A=14000(1.1)^3[/tex]
[tex]A=14000\times 1.331[/tex]
[tex]A=18634[/tex]
Therefore, The value of the car is $18634.
