The cost of a bike depreciates at the rate of 5% per annum. If its present value is Rs. 60,000, then what will be its value after 2 years?
- ((a))
Rs. 55,500
- ((b))
Rs. 55,000
- ((c))
Rs. 54,100
- ((d))
Rs. 54,150
Show Answer
Rs. 54,150
Formula used
Value of a commodity after 'n' years with depreciation rate 'r'% p.a. is
(Actual\ value \times (1 - {r\over100})^n)
Given:
Cost of Bike = Rs.60,000
Rate of depreciation = 5% p.a.
Calculation
The Value of the Bike after two years will be,
(Actual\ value \times (1 - {r\over100})^n)
(⇒ 60000 \times (1 - {5\over100})^2)
(⇒ 60000 \times ({19\over20})^2)
⇒ Rs. 54150


























