Malcolm buys a caravan for £12000. It depreciates by 31% per year. How much is it worth after 7 years?

1 Answer
Apr 10, 2018

Step by step solution. After 7 years it worths 893.5 GBP

Explanation:

W stands for the worth:
1st year: W_1= 0.69times12000 = 8280

2nd year: W_2= 0.69times8280 = 5713.2

3rd year: W_3= 0.69times5713.2 = 3942.1

4th year: W_4= 0.69times3942.1 = 2720.0

5th year: W_5= 0.69times2720.0 = 1876.8

6th year: W_6= 0.69times1876.8 = 1295

7th year: W_7= 0.69times1295 = 893.5

Note that it keeps its 69% of the value each year..