write an exponential function to model: a $12,000 car depreciates 9% each year

Question

a $12,000 car depreciates 9% each year

Answer 1

Depreciation is 100-9%=91% per annum; that is, the car is worth 0.91 the previous year's value. After n years the value depreciates to 0.91^n of its original value, so the model is V(n)=12000*0.91^n, where V(n) is the value after n years. Example: after 5 years its value is 12000*0.91^5=$7,488 approximately.