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# A piece of equipment cost a certain factory Rs.6,00,000. If it depreciates in value, 15% the first, 13.5% the next year, 12% the third year, and so on. What will be its value at the end of 10 years, all percentages applying to the original cost?

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Solution

## The piece of equipment depreciates 15% in first year i.e., 15100×600,000=Rs. 90,000 ∴ Value depreciated in 1st year =Rs.90,000 The equipment depreciates at the rate 13.5% in 2nd year i.e. 1351000×600,000=Rs.81000 ∴ Value depreciated in 2st year =Rs.81,000 The value after 3rd year =12100×600000 ∴ Value depreciated in 3rd year =Rs.72000The the series of depreciation become 90,000,81,000,72,000... with,a=90,000 and d=−9000 The total depreciation in 10 years ⇒S10=102[2×90000+(9)(−9000)]=5[180000−81000] =5 [UsingSn=n2[2a+(n−1)d]] =Rs.495,000 ∴ The cost of machine after 10 years =600,000−495,000=Rs.105,000  Suggest Corrections  82      Similar questions  Related Videos   Application of Compound Interest
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