Example 3

Sajeena paid for a new car in April 2004. The car was worth in April 2012. Assuming a constant annual rate of decrease in value, what was the annual rate of decrease? What was the value of the car in April 2009? What is the predicted value of the car for April 2018?
  1. Find the percent of decrease for the time period April 2004 to April 2012.
  2. Find the annual decay factor.
  3. Use the annual decay factor to find the annual rate of decay, or decrease.
  4. Find the value of the car in April 2009.
  5. Find the predicted value of the car in April 2018.
  6. Summarize the answers from steps 3, 4, and 5.
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