Question

Madhavi bought a scooter for $Rs.40,000$ but she does not have enough money to pay all at once. The shopkeeper says that she can divide the cost into 4 equal monthly instalments but she would have to pay $Rs.100$ extra each month for 4 months. What is this additional amount paid by Madhavi to the shopkeeper called as and calculate the total extra amount at the end of 4 months paid by Madhavi?

• A. Profit, $Rs.400$
• B. Principal, $Rs.400$
• C. Loss, $Rs.400$
• D. Interest, $Rs.400$

Answer 1

Answer: (D)

Interest, $Rs.400$

$Costofscooter=Rs.40000$

$No.ofinstallments=4$

$\therefore costofeachinstallments=\frac{40000}{4}$

$=10000$

$But100ispaidextraineachinstalment.$

$Totalextraamt.paid=100\times 4=400$

The seller costs this extra $400$ as interest as the profit is included in $Rs.40000$

$\therefore optionD$