Thinking Mathematically (6th Edition)

Published by Pearson
ISBN 10: 0321867327
ISBN 13: 978-0-32186-732-2

Chapter 1 - Problem Solving and Critical Thinking - Chapter Summary, Review, and Test - Review Exercises: 37

Answer

At the end of year 5, the automobile is worth 15,500 dollars.

Work Step by Step

If the automobile’s beginning value is 37,000 dollars and it is worth 2600 dollars at the end of 8 years, it has depreciated 34,400 dollars (37,000 - 2,600 = 34,400). The total depreciation divided by 8 gives the depreciation per year. ( 34,400 $\div$ 8 = 4,300). So, the automobile depreciates 4,300 dollars per year. After 5 years, the total depreciation is 4,300 x 5 or 21,500 dollars. If we subtract the depreciation after 5 years from the beginning cost of the automobile, we get the value of the automobile after 5 years: 37,000 - 21,500 = 15,500.
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