The number of years it will take for the guitar to be valued at $768 given the initial value and the rate of depreciation is 4 years.
In how many years will the guitar be valued at $768?
When an asset deperciates, it means that with the passage of time, the value of the asset declines.
Number of years = (In FV / PV) / r
- FV = future value = 768
- PV = present value = 1875
- r = rate of depeciation = 20
(In 768 / 1875) / 0.2 = 4 years
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