Question

The value of a car depreciates every year by \( 10\%\) . What will be its value after \( 3\) years if its present value is \(₹6,25,000\)?

• A. \( ₹4,50,000\)
• B. \( ₹4.52,250\)
• C. \( ₹4,55,625\)
• D. \( ₹4,62.500\)

Answer 1

The Correct Option is C

To determine the depreciated value of the car after 3 years, we can use the formula for depreciation, which is given by:

\( V = P \times (1 - r)^n \)

where:

• \( V \) is the value of the car after \( n \) years.
• \( P \) is the present value of the car, which is ₹6,25,000.
• \( r \) is the rate of depreciation, which is \( 10\% \) or \( 0.10 \).
• \( n \) is the number of years, which is \( 3 \).

Plugging in the values, we get:

\( V = 6,25,000 \times (1 - 0.10)^3 \)

\( = 6,25,000 \times (0.9)^3 \)

\( = 6,25,000 \times 0.729 \)

When we calculate this, we get:

\( V = 6,25,000 \times 0.729 = ₹4,55,625 \)

Therefore, the value of the car after 3 years will be ₹4,55,625, which corresponds to the option \( ₹4,55,625 \).