Jack bought a new boat for $36,000. The value of the boat continuously depreciates at a rate of 15%. Find the value of the boat after 5 years.

a. $17,005

b. $7,621

c. $7,240

d. $4,140

The value of the boat is $15,973 after 5 years.

Given that,

According to the scenario, computation of the given data are as follows,

Value of boat =

By putting the value, we get

Value =

=

= 36,000 0.4437053125

= $15,973.4  or $15,973

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$15973.4

Step-by-step explanation:

The formula for depreciation is:

a(1 - r)^t

a = Initial value =$36,000

r = depreciation rate = 15% = 0.15

t = time in years = 5 years

The depreciation value = $36000 × (1 - 0.15)⁵

= 36000(0.85)⁵

= $15973.39125

Approximately = $15973.4

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step-by-step explanation: