Multiple choice

A car with a price of Rs. 6,50,000 is bought by making some down payment. On the balance, a simple interest of 10% is charged in lump sum and the money is to be paid in 20 equal annual instalments of Rs. 25,000. How much is the down payment ?

  1. Rs. 1,55,945

  2. Rs. 1,95,455

  3. Rs. 1,94,555

  4. Rs. 1,45,955
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Let P be the balance amount after down payment. Simple interest at 10% on P is 0.1P, so total payable = P + 0.1P = 1.1P. This equals 20 × 25,000 = 5,00,000. Therefore 1.1P = 5,00,000, giving P = 4,54,545 (approx). Down payment = 6,50,000 - 4,54,545 = 1,95,455. Option B matches.

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