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Carl bought some dope for 25 000$ after 4 year the dope that he had once bought costs only 4000$ now. How much reduction in percent did the dope get reduced by yearly? If you don''t know the answer with calculation, do not attempt to help as it will only make it worse. Thanks for your help. (I have the answer, but I need to get the calculation and see the connection).
 Jan 26, 2014

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FatlumFerizi100:

Carl bought some dope for 25 000$ after 4 year the dope that he had once bought costs only 4000$ now. How much reduction in percent did the dope get reduced by yearly? If you don''t know the answer with calculation, do not attempt to help as it will only make it worse. Thanks for your help. (I have the answer, but I need to get the calculation and see the connection).



Hi FatlumFerizi100,

Future value = original value ( 1- yearly interest rate as a decimal) numberof years

4000 = 25000(1-r) 4

4000/25000 = (1-r) 4

0.16 = (1-r) 4

0.16 1/4 = 1 - r

r = 1 - 0.16 1/4

r = 0.3675....

The yearly depreciation is approx 36.8%

does that agree with your answer? Let me know if there is a problem or if you don't understand.
 Jan 27, 2014

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