Question

Mr. Gulati has a Recurring Deposit Account of Rs 300 per month. If the rate of intererst is 12% and the maturity value of this account is Rs 8,100; find the time (in years ) of this Recurring Deposit Account.

Answer 1

$P=Rs.300,noofmonths=n,rate=12\%MaturityAmount=Rs.8100$

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

$8100=300\times n+300\times \frac{n(n+1)}{2\times 12}\times \frac{12}{100}$

$8100=300n+\frac{3}{2}n(n+1)$

$1.5n^2+301.5n-8100=0$

$n^2+201n-5400=0$

$n^2+(225-24)n-5400=0$

$n^2+225n-24n-5400=0$

$n(n+225)-24(n+225)=0$

$(n+225)(n-24)=0$

$n=-225or24$

Hence n = 24 months or 2 years