Question

Neha has a recurring deposit account in a bank and deposits Rs. 400 per month for 2.5 years. The rate of interest paid by bank if the maturity value of this account is Rs. 13240 will be

• A. 8%
• B. 10%
• C. 12%
• D. 11%

Answer 1

The correct option is A

8%

Let rate of interest be r
P = Rs.400
n= 2.5 $\times$ 12 =30 months
M.V = 13240
Amount deposited = P $\times$ n
= 400 $\times$ 30 = 12000
Interest = $\frac{P\times n(n+1)}{2\times 12}\left(\frac{r}{100}\right)=155r$
Since Maturity value =Amount Deposited + Interest
13240 = 12000+155r
r= $\frac{1240}{155}$= 8 %