Dinesh purchased a scooter for ₹ 24000.

Dinesh purchased a scooter for ₹ 24000. The value of the scooter is depreciating at the rate of 5% per annum. Calculate its value after 3 years.

Solution:

It is given that
Present value of scooter (P) = ₹ 24000
Rate of depreciation (r) = 5%
Period (n) = 3 years
We know that
Value after 3 years = P (1 – r/100)n
Substituting the values
= 24000 (1 – 5/100)3
By further calculation
= 24000 × 19/20 × 19/20 × 19/20
= ₹ 20577

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