Question

Bill buys a new machine.
The value of the machine depreciates by 20% each year.
Bill wants to work out the value of the machine after 2 years.
By what single decimal number should Bill multiply the value of the machine when new?​

Answer 1

Answer:

For a, the machine depreciates 20% of its current value each year.  So, It will lose 20% of its value in the first year.  Then in the second year, it will lose 20% of THAT value (not of the original value) and so on.

b) Since the machine loses 20% of its value each year, it retains 80% of its value each