Question

A value of a machine depreciates every year at the rate of $12\%$. The present value of a machine is Rs. $5500$. What was the value of the machine $2$ years before?

Answer 1

Given, $P=5500,r=12\%$ , $n=2$ years
We know $A=P\left[{(1-\frac{r}{100})}^n\right]$
$A=5500\left[{(1-\frac{12}{100})}^2\right]$
$A=$ Rs. $4259.20$

Thus, the value of machine $2$ years before is Rs. $4259.20$.