Depreciation applicable to an equipment is 20%. The value of the equipment 3 years from now will be less by :

Answer: Option B

Let the present value be Rs. 100
Value after 3 years :
$$\begin{array}{rl}& =\text{Rs}\text{. }\left[100\times {\left(1-\frac{20}{100}\right)}^3\right]\\ & =\text{Rs}\text{. }\left(100\times \frac{4}{5}\times \frac{4}{5}\times \frac{4}{5}\right)\\ & =\text{Rs}\text{. 51}\text{.20}\end{array}$$
∴ Reduction in value :
= (100 - 51.20)%
= 48.8%