Question

Ashish deposits a certain sum of money every month in a Recurring Deposit Account for a period of 12 months. If the bank pays interest at the rate of 11% p.a. and Ashish gets ₹ 12,715 as the maturity value of this account, what sum of money did he pay every month?

• A. ₹ 1000
• B. ₹ 12,715
• C. ₹ 750
• D. ₹ 1050

Answer 1

The correct option is A

₹ 1000

Let Instalment per month(P) = ₹ P

Number of months(n) = 12

Money Deposited = 12 P

Rate of interest(r)= 11%p.a.

Interest = P $\times$ $\frac{n\times (n+1)}{2\times 12}$ $\times$ $\frac{r}{100}$

= P $\times$ $\frac{12\times (12+1)}{2\times 12}$ $\times$ $\frac{11}{100}$

= $\frac{143P}{200}$

Given Maturity Value= ₹12,715

Maturity Value = Money Deposited + Interest

12,715 = 12 P + $\frac{143P}{200}$

$\therefore$ P = $\frac{12715\times 200}{2543}$ = ₹ 1000

Hence the Monthly Instalment per month is ₹ 1000