Present Value of a printing machine is Rs 1,80,000 (Indian Currency, 1 Rs = 100 paisa) Value of the machine depreciated at the rate of the machine after 34 years?

I am puzzled because of this 34 years!!!!!!!!!!!!!!!!

1 Answer
May 10, 2017

Just follow following steps.

Explanation:

No need to be puzzled.

Just think that Present Value is P

and discounted value D after discounting say at r% after n years will be given by

D=P(1-r/100)^n

You have not given rate of depreciation r but let r=10% and years are 34

D=P(1-10/100)^34=Pxx(9/10)^34=Pxx(0.9)^34

You can use a scientific calculator to calculate this.

Just use function x^y and for this first enter 0.9 then click at x^y and then 34 and you get

0.02781283894436935112572857762318

Multiply it by P=180000 and you get

discounted value as Rs.5006.31

If r is different you can calculate it accordingly.