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Question

A machine was purchased 2 years ago. Its value decreases by 10 % every year. Its present value is ₹ 97200. Find the purchase price of the machine


A

₹ 1,20,000

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B

₹ 1,10,000

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C

₹ 90,000

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D

1,00,000

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Solution

The correct option is A

₹ 1,20,000


Given Present value of the machine ₹ 97200, Rate = 10 % and n = 2 years
The present value of the machine = Value of the machine 2 years ago (1r100)2

97200 = P (110100)2
97200 = P(90100)2
P = 97200×10×109×9
= ₹ 120000


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