Josephine purchased a used vehicle that depreciates under a straight-line
method. the initial value of the car is $5000, and the salvage value is $500. if
the car is expected to have a useful life of another 5 years, how much will it
be worth in 2 years?
a. $3200
b. $1000
c. $900
d. $4000

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:

Plug in 2 for n. This gives,

∴ Depreciation after 2 years =$ 1000

Value of car after 2 years = Initial value - Depreciation after 2 years

Value of car after 2 years =

Therefore, value of car after 2 years = $ 4000

lo.lll

step-by-step explanation:

answer: c, the green line

step-by-step explanation:

there is no black line, eliminate b.

simple interest implies periodic payments, but the red line shows no payments, eliminate d.

simple interest has equal payments. if paid say every day, the graph is about a straight line (actually a stairstep).

the yellow line is not straight, eliminate a.

check: the green line is straight, answer is c.

simple interest with positive interest rate gives a straight line sloping up to the right. green line:

g(t) = $100 + ($200-$100) ÷ (20 years) × (t years)

= $100 + (4%/year) × ($100)(t years)

incidentally, the yellow line curving upward represents continuously compounded interest

y = $100 × 2^(t years / (14 assuming the yellow line hits $200 at 14 years. 2^0 is 1, so y(0) = $100; 2^(14/14) is 2, so y(14) = $200.