A motorbike depreciates at 10% per annum on its reducing value. If it is worth Rs. 51,840 now, two years after purchase, what was its purchase price?
Correct answer A. Rs. 64,000
Explanation
Purchase price = 51840 / (0.9)² = 51840 / 0.81 = Rs. 64,000. Check: 64000 × 0.9 = 57600 and 57600 × 0.9 = 51840.
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