Answer:
Total reduction after 2 years = [tex]16,200[/tex] rupees
Step-by-step explanation:
Current price of a machine [tex](P_0)[/tex] = 45,000 rupees
Rate of depreciation (r) = 20%
Time (t) = 2 years
Price after 2 years = [tex]P_0(1-\frac{r}{100} )^t[/tex]
[tex]=45000(1-\frac{20}{100})^2 \\=45000(1-\frac{1}{5})^2\\ =45000(\frac{4}{5})^2\\ =45000(\frac{16}{25})[/tex]
[tex]=28800\,\,[/tex] rupees
Total reduction after 2 years = [tex]P-P_0=45,000-28,800=16,200[/tex] rupees
