The present value of an optical instrument is ₹ 20000. If its value will depreciate 5\% in the first year, 4\% in the second year and 2\% in the third year, what will be its value after 3 years?
(a)₹ 16534.5
(b)₹ 16756.5
(c)₹ 17556.8
(d)₹ 17875.2
Answer
Answer (as printed): D
Explanation
Value after 3 years $=₹\left[20000\left(1-\frac{5}{100}\right)\left(1-\frac{4}{100}\right)\left(1-\frac{2}{100}\right)\right]$ $$=₹\left(20000 \times \frac{95}{100} \times \frac{96}{100} \times \frac{98}{100}\right)=₹ 17875.2 .$$
Explanation as extracted from the printed page; notation may be imperfect.