Question:
Tick (✓) the correct answer:
The value of a machine depreciates at the rate of 10% per annum. It was purchased 3 years ago for Rs 60000. What is the present value of the machine?
(a) Rs 53640
(b) Rs 51680
(c) Rs 43740
(d) Rs 43470
Solution:
(c) Rs. 43740
Here, $A=$ Rs. $P \times\left(1-\frac{R}{100}\right)^{n}$
$=$ Rs. $60000 \times\left(1-\frac{10}{100}\right)^{3}$
$=$ Rs. $60000 \times\left(\frac{90}{100}\right)^{3}$
$=$ Rs. $60000 \times\left(\frac{9}{10}\right) \times\left(\frac{9}{10}\right) \times\left(\frac{9}{10}\right)$
$=$ Rs. $(60 \times 9 \times 9 \times 9)$
$=$ Rs. 43740
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