Question

The value of a residential flat constructed at a cost of ₹100000 is depreciating at the rate of 10% per annum. what will be its value 3 years after construction?​

Answer 1

WORTH OF BUILDING = 266200

WITH DEPRICIATION AT 10% ITS VALUE AFTER ’n’ YEARS = 266200(1–0.1*n)

WORTH OF LAND = 145800

WITH APPRICIATION AT 10% ITS VALUE AFTER ’n’ YEARS = 145800(1+0.1*n)

THE GIVEN CONDITION IS 266200(1–0.1*n) = 145800(1 + 0.1*n)

i.e (1–0.1*n)/(1+0.1*n) = 145800/266200 = 0.5477

i.e 1–0.1*n =0.5477(1+0.1*n) = 0.5477 + 0.05477*n

i.e 1–0.5477 = 0.1*n + 0.05477)*n = 0.15477*n

i.e 0.4523 = 0.15477*n ; HENCE n = 0.4523/0.15477 = 2.9224

THE ANSWER IS 2.9224 YEARS