A new car is purchased for 20700 dollars. The value of the car depreciates at 13.75% per year. What will the value of the car be, to the nearest cent, after 12 years?

USD 3,508.16

Step-by-step explanation:

Hello

Let´s see what happens the first year when the car depreciates 13.75% of 20700 USD

at the end of the first year the car will have a price of 20700-2486.25=17853.75 USD,  and this will be the price at the beginning of the second year.

completing the data for the 12 years with the help of excel you get

                                          depreciation           New Value

end of year 1  USD 20,700.00   USD 2,846.25   USD 17,853.75  

end of year 2  USD 17,853.75   USD 2,454.89   USD 15,398.86  

end of year 3  USD 15,398.86   USD 2,117.34   USD 13,281.52  

end of year 4  USD 13,281.52   USD 1,826.21   USD 11,455.31  

end of year 5  USD 11,455.31   USD 1,575.10   USD 9,880.20  

end of year 6  USD 9,880.20   USD 1,358.53   USD 8,521.68  

end of year 7  USD 8,521.68   USD 1,171.73            USD 7,349.94  

end of year 8  USD 7,349.94   USD 1,010.62   USD 6,339.33  

end of year 9  USD 6,339.33   USD 871.66           USD 5,467.67  

end of year 10 USD 5,467.67   USD 751.80       USD 4,715.87  

end of year 11  USD 4,715.87   USD 648.43     USD 4,067.43  

end of year 12 USD 4,067.43   USD 559.27   USD 3,508.16

after 12 years the car will ha a value of USD 3508.16

you can verify this by applying the formula

.

Have a great day.