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Mr. Pritesh reduced the value of his assets by 5% each year, which were purchased for Rs.50,00,000/-. Find the value of assets after 2 years.

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#### Solution

Given, initial value of assets = V

= ₹ 50,00,000/-

Rate of depreciation per annum = r = 5%

Number of years = n = 2 years

∴ Value of assets after two years = V`(1 - "r"/100)^"n"`

= `50,00,000(1 - 5/100)^2`

= `50,00,000(19/20)^2`

= `(50,00,000 xx 361)/400`

= 12,500 × 361

= 45,12,500

∴ The value of assets after two years is ₹ 45,12,500/-.

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