Answer:
It's value after 10 years will be $10,507,833.3
Step-by-step explanation:
The equation for the value of the jet after t years is:
[tex]C(t) = C_{0}(1 - r)^{t}[/tex]
In which [tex]C_{0}[/tex] is the initial cost and r is the rate it decreases, as a decimal.
A corporate jet originally cost $17,550,000.
This means that [tex]C_{0} = 17550000[/tex]
If its value depreciates by 5 percent per year, what will its value be after 10 years?
This is C(10) when r = 0.05. So
[tex]C(t) = C_{0}(1 - r)^{t}[/tex]
[tex]C(t) = 17550000(0.95)^{t}[/tex]
[tex]C(10) = 17550000(0.95)^{10}[/tex]
[tex]C(10) = 10507833.3[/tex]
It's value after 10 years will be $10,507,833.3
