Question

A scooter was bought at ₹40,000 and its value depreciated at the rate of 10% per annum. Find its value after two years.

• A. ₹48,640
• B. ₹48,000
• C. ₹38,000
• D. ₹32,400

Answer 1

The correct option is D ₹32,400

Depreciation means reduction of value due to use and age of the item.

Using the formula for depreciating value:

$A=P\times [1-\frac{R}{100}{]}^n$
The value of n is 2.
($\because$ we are asked to find the value after 2 years)
$A=40,000\times [1-\frac{10}{100}{]}^2$
$A=40,000\times [1-\frac{1}{10}{]}^2$
$A=40,000\times [\frac{9}{10}{]}^2$
$A=₹32,400$

The value of scooter after one year will be ₹32,400.