SOLUTION: A new car cost $1 20000. After one year, its value decreases by 20%. For the second year, its value decreases by further 10%. What is the value of the car after two years?

Algebra ->  Percentages: Solvers, Trainers, Word Problems and pie charts -> SOLUTION: A new car cost $1 20000. After one year, its value decreases by 20%. For the second year, its value decreases by further 10%. What is the value of the car after two years?       Log On


   

Question 1163334: A new car cost $1 20000. After one year, its value decreases by 20%. For the second year, its value decreases by further 10%. What is the value of the car after two years?
Answer by Theo(13342) About Me  (Show Source):
You can put this solution on YOUR website!
let x = the cost of the car.
after 1 year, the value drops 20%.
x * (1 - .20) = .8 * x
after the second year, it drops another 10%.
.8 * x * (1 - .1) = .9 * .8 * x = .72 * x

if the original cost of the car was 120,000, then the value of the car at the end of the second year is .72 * that = 86,400.

if the original cost of the car was 12,000, then the value of the car at the end of the second year is .72 * that = 8,640.