Sec 1.5.pdf - Math 1313 Section 1.5 Section 1.5 Linear...

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Math 1313 Section 1.5 Section 1.5: Linear Models An asset is an item owned that has value. Linear Depreciation refers to the amount of decrease in the book value of an asset. The purchase price , also known as original cost , of an asset is the price paid for the asset when purchased. The scrap value of an asset is the remaining value after it is no longer seen as useable. Example 1: In 2010, the B&C Company installed a new machine in one of its factories at a cost of $150,000. The machine is depreciated linearly over 15 years with no scrap value. a. Find the rate of depreciation for this machine. 01150,000 is C me value b. Find an expression for the machine’s book value in the t-th year of use (0 < t < 15). 0 01150,000 is C me value
Example 2: A company’s car has an original value of $85, 000 and will be depreciated linearly over 6 years with scrap value of $10,000. a. Find the expression giving the book value of the car at the end of year t (0 < t < 6). b. Find the car’s book value in at the end of the third year.

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