A piece of equipment cost a certain factory 6,00,000. If it depreciates in value, 15% the first year, 13.5% the next year, 12% the third year, and so on, what will be its value at the end of 10 years, all percentages applying to the original cost?

Answer: Option B

Let the cost of an equipment is Rs. 100
Now the percentages of depreciation at the end of 1st, 2^nd, 3^rd years are 15, 13.5, 12, which are in A.P., with a = 15 and d = - 1.5
Hence, percentage of depreciation in the tenth year = a + (10 - 1) d = 15 + 9 (-1.5) = 1.5
Also total value depreciated in 10 years = 15 + 13.5 + 12 + ..... + 1.5 = 82.5
Hence, the value of equipment at the end of 10 years = 100 - 82.5 = 17.5
The total cost being
$$\begin{array}{rl}& =\text{Rs}\text{.}\frac{6,00,000}{100}\times 17.5\\ & =\text{Rs}\text{.}1,05,000\end{array}$$