A manufacturer buys a new machine costing exist250000 Its ex

A manufacturer buys a new machine costing exist250,000. Its expected lifetime is 8 years, and at the end of that time, the machine has a salvage of exist2000. Find a formula (equation) for the value of the machine after t years where 0 lessthanorequalto t lessthanorequalto 8. Use the equation found in part (a) to find the value of the machine after 6 years.

Solution

Here machine value decrease in each year by

= (250000-2000)/8 = $31000

a) value of machine after t years = 250000-31000t

B) for t = 6 yrs

Value of machine= 250000-31000*6= $64000

So, value of machine after 6 yrs is $64000