Question 1137004


Original Price = ${{{17000}}}
 
if reduced by {{{13.5}}}% each year,

after one year, this can be represented as:
 
${{{17000 - 0.135*17000}}}  or  ${{{17000*(1 - 0.135) }}} 
 
or  ${{{17000*(0.865)}}}


WE THEN JUST MULTIPLY THE PREVIOUS AMOUNT BY{{{ 0.865}}} EACH YEAR
 
making a table

YEAR  |   AMOUNT
   {{{0}}}  |      ${{{17000}}}
   {{{1 }}}  |     ${{{17000*(0.865)}}}
   {{{2 }}}  |     ${{{17000*(0.865)*(0.865) }}} 
   {{{3}}}  |      ${{{17000*(0.865)*(0.865)*(0.865) }}} 
  
and so on
 
WE CAN REWRITE THIS AS:  ${{{17000*(0.8)^n}}}  WHERE {{{n}}} IS THE NUMBER OF YEARS
 
SO AFTER {{{12}}} YEARS:  AMOUNT = ${{{17000*(0.865)^12  =  2982.92 }}}