Question

Mr. Singh get Rs. 6455 at the end of one year at the rate of 14% per annum in a Reccuring deposit account. The monthly installment is ___.

• A. Rs. 600
• B. Rs. 500
• C. Rs. 700
• D. Rs. 550

Answer 1

The correct option is B

Rs. 500

Suppose Mr.Singh deposited Rs. 100 per month (P =100)
Money deposited in 12 Months = 12 $\times$ 100 = 1200
Interest will be $\frac{P\times n(n+1)}{2\times 12}\times \frac{x}{100}$
I = $\frac{100\times 12\times 13}{2\times 12}\times \frac{14}{100}=Rs.91$
Maturity value = P $\times$ n + Interest
Maturity value = 1200+ 91
Maturity value = 1291
Now applying the unit any method we get
When maturity value is 1291, Monthly installment is 100
so when maturity value is 6455. monthly installment will be $\frac{100}{1291}\times 6455=500$