Question

the value of the machine depreciate at 12.5% p.a.it was purchased 3 years ago.if its present value is rupees 13720,find the original value of the machine 3 years ago.

Answer 1

Hi there!

Let Principle amount be = Rs. P

Here,

Rate, R = 12.5% p.a
Time, n = 3 years
Amount, A = Rs. 13720

ATQ,

A = P $( 1 - R/100 )^n$

13720 = P $( 1 - 12.5/100 )^3$

13720 = P $( 1 - 125/1000 )^3$

13720 = P $( 1 - 1/8 )^3$

13720 = P $( 7/8 )^3$

P = 13720 × 512/ 343

P = 20480

Hence, the original value of the machine 3 years ago was Rs. 20, 480.

[ Thank you! for asking the question. ]
Hope it helps!