A farmer depreciates a $106,250 tractor. He estimates that the resale value of the tractor n years after purchase is 80% of its value from the previous year.
(a) Write a formula for the nth term of a sequence that represents the resale value of the tractor n years after purchase.
an = 106,250(0.8)^n
(b) What will be the resale value be 6 yr after purchase? Round to the nearest $1000.
The resale value will be approximately $