Extended Constructed Response 3

Here are some reminders for when you are completing this Extended Constructed Response Task:

• Carefully read each part of the task before writing your response on a sheet of paper.
• Be sure to complete all parts of the task.
• Clearly explain your answer and show all your work.
• Your explanation can include words, tables, diagrams, or pictures.
• You may use a calculator and a ruler for this task.

Tamara purchased a new car two years ago. The original value of the car was $27,750. She is trying to sell the car now, and wants to know the present value of the car (taking into account depreciation.) During the first year of ownership, the value of the car depreciated 22.5%. During the second year of ownership, the value of the car depreciated 12.5% of its value at the end of Year 1.

Use the information above to complete the following:

• What is the value of the car at the end of Year 2? Show all work.

• If Tamara waits another year before selling the car, and the rate of depreciation stays at 12.5%, how much value will the car lose during the third year? Show all work.

• What would be the value of the car at the end of Year 3? Explain.