Answers and Solutions

Answer

Depreciation is 7% per year

Initital value Rs 80000. Depreciated Value at the end of year 1 = 80000-1.07x 80000 = 74400

Value at the end of year 2 = 74400 - 74400 X 0.07 = 69192

Value at the end of year 3 = 69192-0.07 x 69192 = 64348.56

Value at the end of year 4 = 64348.56- 0.07 x 64348.56 = 59844.16

Value at the end of year 5 = 59844.16 - 0.07 x 59844.16 = 55655.07                 Ans

Answer

If we assume that it losses every year by 7% of its current year value then after five years its value will be

80000 X (.93)^5 = 55655.07

But if we assume it losses 7% every year of its original value the answer will be 80000 X 65 / 100 = 52000

Answer

cost price =80,000

value lost in first yr=(1-7%)*80,000=

value lost in fifth yr=80,000*(1-0.07)*(1-0.07)*(1-0.07)*(1-0.07)*(1-0.07)=55655.069

Answer

Answer

The answer shall be compounded on an annual basis. The final amount=80,000(1-.07) ^5

The answer is 55,655.0695

Answer

55655

Answer

Answer

Answer

Answer

This is the case of CI, where interest rate is negative. This is because for every year the value is decreased by 7% of its value at the beigning of first year. It is similar to the case of compound intrest where the interest is added to the amount and for next year the interest is applied on the sum of amount and interest of previous year  

Amount at the end of n years when compound interest is applied is given as  A= P(1+r/100)^n 

In this case P=Rs 80,000 r=-7%, n=5  

So value at end of 5 years is  A= 80000(1-7/100)^5 = 80000*(93/100)^5= Rs 55655.01 approx....

Answer

For First year,

80,000*(1-7/100)

For Second Year,

80,000*(1-7/100)*(1-7/100)

For Five Years,

80,000*(1-7/100)*(1-7/100)*(1-7/100)*(1-7/100)*(1-7/100)

55655.06

Answer

V = Rs.80000*[1-7/100]^5 = Rs. 55655.06 (approx).  Expl: Depriciation Rule

Answer

80000*[1-7/100]^5

8*93*93*93*93*93/1000000

55655.06

Answer

We can solve this question by considering it as a case of time vale of money (reduction in value every year by 7% rate of interest). As we have to find the value after 5 years of time, use formula:  FV= A * FVIF**

**FVIF = (1 +r)^n

FV =A * FVIF

FV = 80000 * [1 + (-0.07)^5]

FV = 80000 * [0.696] 

FV = 55655.07 (approx)

So, the value of car which is bought at Rs. 80,000, after 5 years which has reduction in value at 7% anually will be Rs. 55655.07 (approx).

Answer

after first year cars value will be 80,000*(1-7/100)

After second year cars value will be  80,000(1-7/100)(1-7/100)

so after 5 year the value will be 80,000(1-7/100)^5