If a car depreciates in value by 10% each year, what is its value after one year if it originally cost $20,000?

To determine the value of the car after one year of depreciation at a rate of 10%, we start with the original cost of the car, which is $20,000.

To calculate the amount of depreciation after one year, we need to find 10% of the original price. This is done by multiplying the original cost by 0.10:

[

10% \text{ of } $20,000 = 0.10 \times 20,000 = $2,000

]

Next, we subtract this depreciation amount from the original cost to find the value after one year:

[

\text{Value after one year} = \text{Original cost} - \text{Depreciation}

]

[

= 20,000 - 2,000 = 18,000

]

Thus, the value of the car after one year, considering the 10% depreciation, is $18,000. This calculation confirms why this choice is the correct answer. It accurately reflects the reduction in value due to depreciation applied to the original price.