Set 15: Exponential Functions

Choice A is correct. Choice A is the correct answer. Use exponential decay for depreciation. 1. Retention Rate: If it loses 15%, it keeps 85% = 0.85. 2. Formula: $V(t) = 25000(0.85)^t$ where $t = 4$. 3. Calculate: $V(4) = 25000(0.85)^4 = 25000(0.52200625) \approx 13,050.06$. Strategic Tip: Depreciation of 15% means retention factor of 0.85. Choice B is incorrect because this assumes too much depreciation. Choice C is incorrect because this assumes only 1-2 years of depreciation. Choice D is incorrect because this assumes only 1 year of depreciation.