Question

A T.V is valued at ₹30,000 if its value falls at 5% per year, what will be its value after 2 years?

• A. Rs 27,075
• B. Rs 37,075
• C. Rs 27,080
• D. Rs 27,085

Answer 1

The correct option is A Rs 27,075

P= Present value of T.V= ₹ 30,000

R= -5 p.c.p.a ( since the value is depreciating)

A = value after two years

$=P(1+\frac{r}{100}{)}^n$

$=30,000(1+\frac{-5}{100}{)}^2$

$=30,000(\frac{95}{100}{)}^2$

$=30,000\times \frac{95}{100}\times \frac{95}{100}$

$=27,075$

The value of T.V after two years = ₹ 27,075