Question

A clock manufacturer decreases the price of a particular model by 6% each year. If the current price of the model is ₹ 4500, then what would be the price after 2 years?

• A. ₹ 4,993 (approx)
• B. ₹ 5,026 (approx)
• C. ₹ 5,093 (approx)
• D. ₹ 5,103 (approx)

Answer 1

The correct option is C

₹ 5,093 (approx)

Here, V = current value = ₹ 4500, n = 2 years, r = 6%,

Let, $V_2$ = Price after 2 years

Using $V=V_2{(1-\frac{r}{100})}^n,$
$4500=V_2{(1-\frac{6}{100})}^{2}or,4500=V_2{\left(\frac{94}{100}\right)}^2$

or,$V_2=4500\times (\frac{100}{94}{)}^2=₹5,093$ (approx)