1. We start with the initial value of the car, which is $1000000$. 2. The value of the car depreciates by $5\%$ every year, so the value at the end of each year can be calculated as: $$\text{Value after } n \text{ years} = 1000000 \times (1 - 0.05)^n = 1000000 \times 0.95^n$$ 3. The insurance premium each year is $3\%$ of the car's value at the start of that year (before depreciation that year). 4. First-year premium is calculated from the initial value: $$\text{Premium}_1 = 1000000 \times 3\% = 1000000 \times 0.03 = 30000$$ 5. Second-year premium is based on value after 1 year depreciation: $$\text{Value at start of year 2} = 1000000 \times 0.95 = 950000$$ $$\text{Premium}_2 = 950000 \times 0.03 = 28500$$ 6. Third-year premium is based on value after 2 years depreciation: $$\text{Value at start of year 3} = 1000000 \times 0.95^2 = 1000000 \times 0.9025 = 902500$$ $$\text{Premium}_3 = 902500 \times 0.03 = 27075$$ **Final answers:** - First year premium = $30000$ - Second year premium = $28500$ - Third year premium = $27075$