You bought a Toyota corolla in 2004 for 12500. this car's value depreciates by 7% a year. How much is the car worth now (2016) ? How much is it worth 2020?

You solve this by first determining how many years is it from 2004 to 2016. It is 12 years. Now you do 0.07 (which is 7% in decimal form) times 12 which gives you 0.84. To find 84% of 12,500, you just multiply them two together and get 10,500. You finish this by subtracting 10500 from 12500 and you get $2,000 as your final answer.

For 2020, you determine how many years it is from 2004 to 2020 and you get 16. So you multiply 0.07 times 16 giving you 1.12. You multiply 1.12 times 12,500 and you get 14,000. Finally, you subtract 14,000 from 12,500 giving you - 1500.