If an investment depreciates at 3% pa, how much will it be worth in 10 years?

Question

I thought my method was the correct one, but I have seen a different one from a respectable source and now I wonder.

Answer 1

The 3% is compounded thus you must multiply (.97) by (.97) 10 X's or, .97^10 (.97 to the 10th power). This equals .737424, meaning you will only have 73.7424% of your initial investment left.

Not a good investment, unless you're short it.

Answer 2

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