Question

If Ravi bought a bicycle at ₹4000 and its value depreciates at the rate of 10% per annum then the value of the bicycle after three years will be .

• A. ₹2,616
• B. ₹3000
• C. ₹2,916

Answer 1

The correct option is C ₹2,916

$\text{Given: Principal (P) = ₹4000,}\text{Rate (R) = 10\%, Time(n) = 3 years}$

Now by using the formula for depreciating value, we can write
$A=P\times [1-\frac{R}{100}{]}^{n}A=4000\times [1-\frac{10}{100}{]}^{3}A=4000\times [1-\frac{1}{10}{]}^{3}A=4000\times [\frac{9}{10}{]}^{3}A=₹2,916$

$\therefore \text{The value of the bicycle after 3 years}$$\text{will be ₹2,916.}$