Question 43:
A machine is purchased for ₹18,200 and its value decreases by 10% every year. If the depreciation is compounded annually, what will be the value of the machine after 2 years?
Options :
- a) ₹14,742
- b) ₹15,200
- c) ₹13,424
- d) ₹16,480
correct answer : a)
Explanation :
Value after 2 years = Initial Value × (1 – r/100)² = 18,200 × (0.90)² = 18,200 × 0.81 = ₹14,742.