In general, car values do depreciate over time, and the depreciation rate can vary depending on several factors such as the make and model of the car, how well it is maintained, and market conditions. However, there are some common estimates about the depreciation rates that can be considered standard.
Typically, a new car loses a significant portion of its value in the first few years. Specifically:
1. The first year usually sees the most significant depreciation, with values often dropping around 20%.
2. In the following two years, the depreciation rate decreases, but the car will still lose value each year, though not as sharply as in the first year.
Considering these general guidelines:
- After the first year, a car typically loses around 20% of its value.
- Each subsequent year, the depreciation rate is lower but still present.
Given these considerations and the various options provided:
- Option A (10%) and Option D (5%) are too low to account for the typical depreciation seen in the first few years.
- Option B (60%) seems unusually high and not consistent with typical estimates.
- Option C (20%) aligns with the initial significant drop in value during the first year.
Thus, the correct answer is:
○ C.
20%
