Question

The value of a car decreases 20% annually. If the car was purchased two years ago for *3,64,000, find the present value of the car​

Answer 1

Answer:

The present value of the car is Rs. $232960$.

Step-by-step explanation:

Given : Annual decrease in car price = $20$%

           Price of a car two years ago = Rs. $3,64,000.$

To find : The present value of the car​  =?

Solution :

• It is given that the annual decrease in car price = $20$%

           Price of a car two years ago = Rs. $3,64,000.$

• We have to find the present value of the car​  =?
• Let $x$ be the present value of the car.
• To find the present value of car, we have to calculate $20$% decrease on the price of car for two year.
• Now,

          Decrease in price of a car after one year =  $20$% of $364000$

                                                      = $\frac{20}{100} *364000$

                                                      = Rs. $72800$  

         Cost price of a car after one year = $364000-72800$

                                                       = Rs. $291200$

• Now,

            Decrease in price of a car after two years = $20$% of $291200$

                                                        = $\frac{20}{100} *291200$

                                                        = Rs. $58240$

       Cost price of a car after two year = $291200-58240$

                                                        = Rs. $232960$

• ∴ The present value of the car is Rs. $232960$.