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Mathematics

When the cost of a machine decreases by r% per year; the cost of machine in 3 years is :

  1. (1+r100)3\Big(1 + \dfrac{r}{100}\Big)^3 times

  2. (1r100)3\Big(1 - \dfrac{r}{100}\Big)^3 times

  3. (1r100)2\Big(1 - \dfrac{r}{100}\Big)^2 times

  4. (1+r100)2\Big(1 + \dfrac{r}{100}\Big)^2 times

Compound Interest

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Answer

For depreciation :

Value after n years = Present value ×(1r100)n\times \Big(1 - \dfrac{r}{100}\Big)^n

So,

Value of machine after 3 years = Present value ×(1r100)3\times \Big(1 - \dfrac{r}{100}\Big)^3

Hence, Option 2 is the correct option.

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