Question

Dinkar has a recurring deposit account in a bank for a time period of 3.5 years at 9.5 % p.a. He gets Rs 78638 at the time of maturity. What is his monthly installment?

• A. Rs 1800
• B. Rs 1600
• C. Rs 2600
• D. Rs 800

Answer 1

The correct option is B

Rs 1600

Let us suppose that the monthly installment is Rs x, then the total amount deposited by Dinkar = Rs 42x

Equivalent principal for 1 month = Rs x $\times$ $\frac{42(42+1)}{2}$ Rs 903x

Interest on Rs 903x for 1 month at the rate of 9.5% p.a.:

= Rs 903x $\times$ $\frac{1}{12}$ $\times$ $\frac{9.5}{100}$= (7.148) x

Amount on maturity = Rs 42x + Rs (7.148) x = (49.148)x

$\Rightarrow$ (49.148)x = Rs 78638 $\Rightarrow$ x = Rs 1600