Choice A is the correct answer. Interpret the decay factor.

1. Form: $V(t) = a(b)^t$ where $b = 0.88$.
2. Meaning: Each year, value becomes $0.88$ times the previous year.
3. Retention: Keeps 88%, loses 12%.

💡 Strategic Tip: Decay factor of 0.88 means retaining 88%, not losing 88%.

Choice B is incorrect because it misinterprets the factor (keeps 88%, not loses). Choice C is incorrect because 35,000 is the initial price. Choice D is incorrect because the car is depreciating, not appreciating.