Question
The cost of a motorbike increases by 8% annually. If its
current cost is ₹40,000, what will be its cost after 2 years?Solution
ATQ,
If there is successive increase of ‘a%’ and ‘b%’ on a certain quantity/value, then the net percentage increase = a% + b% + [(a × b)/100]%
So, the net percentage increase = 8% + 8% + [(8 × 8)/100]%
= 16% + (64/100)% = 16% + 0.64% = 16.64%
So, the cost of the motorbike after 2 years = 1.1664 × 40000 = ₹46,656
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