Question

An article is bought for $7000 and sold 5 years later for $650. Find the depreciation formula, and the value of the article after 2 years. Let y be the value in dollars, and t be time in years.

Answer 1

@FriedRice

Answer 2

@IMStuck

Answer 3

hello? @FriedRice

Answer 4

sorry

Answer 5

itsok

Answer 6

so you bought a article for $7000

Answer 7

basically y=_ t+_

Answer 8

then you sold it after 5 years for $650

Answer 9

yep

Answer 10

do you know the formula

Answer 11

no

Answer 12

ok lets find out

Answer 13

ok

Answer 14

Depreciation = Cost − Salvage Value
Life in Number of Periods

Answer 15

7000-650 /2
6350 /2
3175 = depreciation

Answer 16

that would be the answer

Answer 17

y= _ t+ ?

Answer 18

price after two years?

Answer 19

what is it

Answer 20

it want the deprecition formula

Answer 21

@aum

Answer 22

y = P(1 - r)^t
y is the future value = $650
P is the present value = $70,000
r is the rate of annual depreciation in decimal = ?
t is number of years = 5

Plug in and solve for r. Put r in (1), simplify, and that will be the depreciation formula.

Then put t = 2 and find y.

Answer 23

P is 7000 (not 70,000)

Answer 24

wait so price after 2 years?

Answer 25

You have to first solve for r and find the depreciation formula.
Then you can find the price after 2 years.

Answer 26

whats the equation look like

Answer 27

I have given you the equation above.

Answer 28

\(\Large y = P(1-r)^t = 7000(1-r)^t\)

When t = 5, y = 650. Solve for r.

Answer 29

13/140

Answer 30

?

Answer 31

idk confused

Answer 32

@aum

Answer 33

\(\Large 650 = 7000(1-r)^5 \\ \Large
\frac{650}{7000} = (1-r)^5 \\ \Large
(1-r)^5 = 0.0928571 \\ \Large
1-r = (0.0928571)^{1/5} = 0.6216745 \\ \Large
y = 7000(0.6216745)^t
\)

Answer 34

That is the depreciation equation.
For the second part, put t = 2 and calculate y.

Answer 35

but y= 7000t?

Answer 36

y = 7000(1-r)^t
We solved for r and substituted above.

Answer 37

basically whats the depreciation formula for this eqaution

Answer 38

it telling me to write it like this y= 7000t + ___

Answer 39

Not sure what they are expecting. But y = 7000(0.6216745)^t works nicely because if I put t = 5, y comes out to be ^650 as given in the problem which tells me the equation is correct. But your book may be doing by some other method.

Answer 40

well no it says it like this _t + _

Answer 41

Can you post a screenshot of the question and what it is telling you the equation should look like?

Answer 42

so 5t+ ???

Answer 43

ok

Answer 44

hold on

Answer 45

@aum

Answer 46

?

Answer 47

@aum

Answer 48

@zaibali.qasmi

Answer 49

This is where posting the original question helps.
They want a linear depreciation formula.
Not the exponential formula that is normally used as I did above.
We will redo the problem.

Answer 50

ok cool

Answer 51

y = mt + b
when t = 0, y = 7000
7000 = 0 + b. b = 7000
y = mt + 7000
when t = 5, y = 650
650 = m(5) + 7000
650-7000 = 5m
-6350 = 5m
m = -1270

y = -1270t + 7000
That is your depreciation equation. In the first box enter -1270 and in the second box enter 7000.

After 2 years, y = -1270(2) + 7000
y = -2540 + 7000
y = $4,460

Answer 52

so after 2 years its4,460

Answer 53

Yes. But sometimes it may not like the comma or the dollar sign. Try just 4460.

Answer 54

ok

Answer 55

Does it let you know right away if it is correct or not?

Answer 56

it right :) thanks

Answer 57

yw.