Sumit has Rs. 90000 with him. He purchases three items A, B, and C for Rs. 15000, Rs. 13000, and Rs. 35000 respectively and puts the remaining money in a bank deposit that pays compound interest @15% per annum. After 2 years, he sells off the three items at 80% of their original price and also withdraws his entire money from the bank by closing the account. What is the total change in his asset?
Sumit has Rs. 90000 with him. He purchases three items A, B, and C for Rs. 15000, Rs. 13000, and Rs. 35000 respectively and puts the remaining money in a bank deposit that pays compound interest @15% per annum. After 2 years, he sells off the three items at 80% of their original price and also withdraws his entire money from the bank by closing the account. What is the total change in his asset?
Solution
Initial amount = ₹90000
Cost of items:
- A = ₹15000
- B = ₹13000
- C = ₹35000
Total = ₹63000
Amount in bank = ₹90000 - ₹63000 = ₹27000
After 2 years:
Bank amount = ₹27000(1 + 0.15)² = ₹27000 × 1.3225 = ₹35707.50
Selling price of items (80% of original):
- A = ₹12000
- B = ₹10400
- C = ₹28000
Total = ₹50400
Final total = ₹35707.50 + ₹50400 = ₹86107.50
Change = ₹86107.50 - ₹90000 = -₹3892.50
Percentage change =
Therefore, the total change in his asset is -4.325%