The cost of a mobile phone, purchased 3 years ago, depreciates at the rate of 20% every year. If its present worth is ₹ 3000, find its purchase price.

₹ 5,859 (approx)

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₹ 5,889 (approx)

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₹ 5,919 (approx)

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₹ 5,949 (approx)

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Solution

The correct option is A
₹ 5,859 (approx)

Here, V = present value = ₹ 3000, n = 3 years, r = 20%,

Let, $V_{0}$ = Purchase price

Using $V = V_{0} {(1 - \frac{r}{100})}^{n},$
$3000 = V_{0} {(1 - \frac{20}{100})}^{3} o r, 3000 = V_{0} {(\frac{80}{100})}^{3}$

or, $V_{0} = 3000 \times (\frac{100}{80})^{3} = ₹ 5, 859$ (approx)

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The cost of a mobile phone, purchased 3 years ago, depreciates at the rate of 20% every year. If its present worth is ₹ 3000, find its purchase price.

The correct option is A ₹ 5,859 (approx) Here, V = present value = ₹ 3000, n = 3 years, r = 20%, Let, V0 = Purchase price Using V=V0(1−r100)n, 3000=V0(1−20100)3or, 3000=V0(80100)3 or, V0=3000×(10080)3=₹5,859 (approx)