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Financial Maths, SMB-019

Alan bought a light aircraft for $76 500. It will depreciate at 14% per annum. 

Using the declining balance method, what will be the salvage value of the light aircraft after 6 years, to the nearest dollar? 

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`$30\ 949`

Show Worked Solution
`S` `= V_0 (1-r)^n`
  `= 76\ 500 (1-14/100)^6`
  `= 76\ 500 (0.86)^6`
  `= $30\ 949.39`
  `=$30\ 949\ \ text{(nearest dollar)}`