Math Problem Statement

Depreciation is the decrease or loss in value of an item due to age, wear, or market conditions. One company buys a new backhoe for $73,000. The company depreciates the backhoe linearly over its useful life of 25 years. Its salvage value at the end of 25 years is $13,000. a) Construct a linear equation in the slope-intercept form that models the value, V(t), of the backhoe as a function of its age t in years. b) Use your model to find the value of the backhoe after 6 years.

Solution

Let's break down and solve the given problem step by step:

Part a) Construct a linear equation for the value V(t)V(t) of the backhoe as a function of its age tt in years.

We are given:

  • The initial value of the backhoe is $73,000.
  • The backhoe depreciates linearly over 25 years.
  • Its salvage value at the end of 25 years is $13,000.

The general equation of a line is in the form: V(t)=mt+bV(t) = mt + b Where:

  • mm is the slope (rate of depreciation per year),
  • tt is the age in years,
  • bb is the initial value (when t=0t = 0).

Step 1: Determine the slope mm.

The slope is the rate of depreciation, which is the change in value divided by the change in time: m=final valueinitial valuetime period=130007300025=6000025=2400m = \frac{\text{final value} - \text{initial value}}{\text{time period}} = \frac{13000 - 73000}{25} = \frac{-60000}{25} = -2400 So, the value of the backhoe decreases by $2,400 per year.

Step 2: Write the equation.

We know that at t=0t = 0, V(0)=73,000V(0) = 73,000, so b=73,000b = 73,000.

Thus, the equation for the value V(t)V(t) of the backhoe is: V(t)=2400t+73000V(t) = -2400t + 73000

Part b) Use your model to find the value of the backhoe after 6 years.

We can substitute t=6t = 6 into the equation ( V(t) = -2400t +

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Math Problem Analysis

Mathematical Concepts

Algebra
Linear Equations
Depreciation

Formulas

Slope-intercept form V(t) = mt + b

Theorems

Linear depreciation

Suitable Grade Level

Grades 9-11