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18 May, 11:56

3.

A farmer buys a new tractor for $75,000. If the tractor depreciates in

value by about 6% per year, how much will it be worth after 15 years?

a $22.992

b

$11,219

C $17,431

$29,647

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Answers (1)
  1. 18 May, 11:59
    0
    Option D. $29,647

    Step-by-step explanation:

    The following were obtained from the question:

    Present value = $75,000

    Rate of depreciation (R) = 6%

    Time (t) = 15 years

    Amount after 15 years = ?

    Since the worth of the tractor is depreciating, we shall apply the following formula to obtain the worth after 15 years:

    Amount = present value x (1 - R) ^t

    Amount = $75000 x (1 - 6%) ^15

    Amount = $75000 x (1 - 0.06) ^15

    Amount = $75000 x (0.94) ^15

    Amount = $29647

    Therefore, the value of the tractor after 15 years is $29647
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