Multiple choice

Rohit opened a recurring deposit account in the bank by paying Rs. 250 per month for 11 months. The rate of interest is 9% per annum and the amount of interest is calculated at the end of each month. Which of the following could be the total interest accumulated after 11 months?

  1. Rs. 144.75

  2. Rs. 123.75

  3. Rs. 184.75

  4. Rs. 244.75

  5. Rs. 223.75
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Interest accumulated on recurring deposit account = [P n (n + 1) r] / [2 x 12 x 100], where monthly installment, P = Rs. 250, number of months, n = 11, rate of interest, r = 9% Interest accumulated after 11 months but calculated at the end of every month = [250 x 11 x 12 x 9] / [2 x 12 x 100]  = Rs. 123.75

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