Question:
The value of a refrigerator which was purchased 2 years ago, depreciates at 12% per annum. If its present value is Rs 9680, for how much was it purchased?
Solution:
Purchase price $=\mathrm{P}\left(1-\frac{\mathrm{R}}{100}\right)^{-\mathrm{n}}$
$\Rightarrow 9,680\left(1-\frac{12}{100}\right)^{-2}$
$=9,680(0.88)^{-2}$
$=12,500$
Thus, the purchase price of the refrigerator was Rs 12,500 .
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