A machine bought for ₹6,25,000 loses 20% of its value every year. Its value at the end of 3 years is:

Each year the value is multiplied by 0.8, so the values form a geometric progression: 6,25,000 → 5,00,000 → 4,00,000 → 3,20,000. In symbols $625000\times (0.8{)}^3=625000\times 0.512$ = ₹3,20,000. (Subtracting 20% of the original three times would wrongly give ₹2,50,000.)