Multiple choice

Suma gets Rs. 7,725.00 at the end of two years from recurring deposit account at the rate of 7% per annum. Which of the following is her monthly instalment?

  1. Rs. 300

  2. Rs. 3,000

  3. Rs. 400

  4. Rs. 600

  5. Rs. 500
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Interest accumulated = [P x n (n + 1) r] / 2400, where P = ?, n = 12 x 2 = 24 months and r = 7%

Interest accumulated = [P x 24 x 25 x 7] / 2400 = 1.75P Maturity amount = 24P + 1.75P 7,725 = 25.75P  Therefore,   P = Rs. 300

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