You bought a bike –
Suppose you have just bought a bike, the price of which is approximately ₹ 2,07,030. To buy a bike you will have to go to the nearest dealer. The seller (dealer) people can be called a dealer or a showroom or can also be called a shop. A seller makes a profit when he sells at a higher price than the price at which he bought. Which we can call ex-showroom. This price does not include the cost of vehicle registration, which must be done at the local RTO. Also, the ex-showroom price does not include road tax and insurance costs.
You bought a bike worth Rs 2 lakh with your hard-earned money cost
Ex-Showroom | ₹ 1,78,253 |
Local RTO | ₹ 16,068 |
Insurance (comprehensive) | ₹ 12,709 |
Suppose, you bought this bike with monthly installment. You paid ₹ 10,000 as a down payment for the first installment. Now your total amount will be ₹1,97,030. Your interest in this will be ₹… If interest is 10 percent then ₹42,835. Your interest will be approximately ₹ 8,567 every year.
Now Petrol – Suppose you travel 40 KM every day, whether to go to an office or the market. If your bike worth Rs 2 lakh gives 35 KMPL, then.
1 Liter = 35 KMPL , 35 Km = ₹102
Liter | kilometer | Days | ₹ Total amount |
01 | 35 | 01 | ₹102 |
30 | 1050 | 30 | ₹3,060 |
360 | 12,600 | 365 | ₹36,720 |
Depreciation – Their value depreciates by 15% (₹1,51,516) as soon as they leave the showroom (cost for repairs). Every year the price is reduced by 10% of the actual value.
Price | Years | Depreciation(10%) |
₹1,51,516 | 1 | ₹1,36,365 |
₹1,36,365 | 2 | ₹1,22,729 |
₹1,22,729 | 3 | ₹1,10,457 |
₹1,10,457 | 4 | ₹99,412 |
₹99,412 | 5 | ₹89,471 |
Insurance – Approximately ₹2100 every year. Approximately – ₹10,500 for 5 years. Insured Declared Value (IDV) is the maximum sum insured determined by the insurer that is provided against the total loss of the insured vehicle. Let us assume the price value is ₹ 1,00,000 (the current market value of the vehicle).
IDV | Relative price |
5% | ₹95,000 |
15% | ₹85,000 |
20% | ₹80,000 |
30% | ₹70,000 |
50% | ₹50,000 |