what was its value three years ago?

The value of a property decreases every year at the rate of 5%. If its present value is ₹ 411540, what was its value three years ago?

Solution:

It is given that
Present value of property = ₹ 411540
Rate of decrease = 5% p.a.
We know that
Value of property 3 years ago = A ÷ (1 – r/100)ⁿ
Substituting the values
= 411540 ÷ (1 – 5/100)³
By further calculation
= 411540 ÷ (19/20)³
So we get
= 411540 × 20/19 × 20/19 × 20/19
= ₹ 480000

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