Answer :
Final answer:
The estimated value of a machine with an initial value of Rs. 15625 after 5 years of depreciating at 20% annually is approximately Rs. 5000.
Explanation:
The question involves calculating the depreciation of a machine over 5 years with an annual depreciation rate of 20%. To estimate the value of the machine after 5 years, we apply the depreciation formula:
Value after n years = Initial value × (1 - depreciation rate)^n
Given the initial value of Rs. 15625 and a depreciation rate of 0.2 (20%), we get:
Value after 5 years = 15625 × (1 - 0.2)^5
Value after 5 years = 15625 × (0.8)^5
Value after 5 years = 15625 × (0.32768)
Value after 5 years = Rs. 5120 (approx)
The closest answer to this calculated value is option c, Rs. 5000. Therefore, the estimated value of the machine at the end of 5 years is Rs. 5000.
