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Question

The cost of a refrigerator is ₹9000. Its value depriciates at the rat of 5% every year . find the total depreciation in its value at the end of 2 years

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Solution

Cost of fridge = Rs.9000

depreciation rate = 5% p.a.

Cost of fridge after 1 year = 9000 - 5/100*9000 = Rs. 9000 - Rs. 450

= Rs. 8550

Cost of fridge after 2 years = 8550- 5/100 * 8550 = Rs. 8550- Rs.427.5

= Rs. 8122.5

So after 2 years , cost of fridge = Rs.8122.50


Therefore total depreciation(initial total money -new money (depreciated)) at end of two years is =
9000-8122.50
=rs 877.50

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