After 4 years of depreciation at a rate of 5% per year, the value of the article can be calculated using the formula for exponential decay, which is:

After 4 years of depreciation at a rate of 5% per year, the value of the article can be calculated using the formula for exponential decay, which is:

  • (A) 10870
  • (B) 9774
  • (C) 8990
  • (D) 9765
Solution:Using the formula for exponential decay: V = P x (1 - r)^tIn our example, we have r = 0.05, t = 4, and we are given Plugging in the numbers: V = 12,000 × (0.95)^4 V = 12,000Answer: (B) 9774
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Related MCQs:

 ‘NATO’ is an abbreviation of:

  • (A) North Atlantic Treaty Organization
  • (B) Non-Aligned Treaty Organization
  • (C) Non-Aligned Trading Organization
  • (D) North American Transport Organization

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