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A scooter was bought at $Rs.42,000$. Its value depreciated at the rate of $8\%$ per annum. Find its value after one year.

Last updated date: 21st Mar 2023
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Hint: Use formula of compound interest $A = P{\left( {1 - \frac{R}{{100}}} \right)^n}$.Compound interest is interest earned in a single year in addition to principal sum.
We have, $P =$ initial principal balance$= Rs.42,000$
$R =$ Rate of depreciation $= 8\%$ per annum
Value of scooter after $n$ years$= P{\left( {1 - \frac{R}{{100}}} \right)^n}$
Value of scooter after $1$ year$= P{\left( {1 - \frac{R}{{100}}} \right)^1}$
$\Rightarrow Rs.42,000\left( {1 - \frac{8}{{100}}} \right) \\ \Rightarrow Rs.42,000 \times \frac{{92}}{{100}} \\ \Rightarrow Rs.38640 \\$
So, the value of a scooter after one year is $Rs.38640$.