Question

A firm purchased an old machine for its manufacturing process. the seller claims that the machine will depreciate 40% in the first year, 30% in the second year, 25% in the third year, and 20% in the fourth year. compute the average depreciation for all four years.

Answer 1

Let the value of machinery be x then depreciation for Ist year is 40x/100 ,for second year 30x/100 ,for third year 25x/100,for forth year 20x/100.at last add all four equations we get  115x/100 then for average value weget 115x/400.