Question

Rahul opens an RD account with a bank and deposits ₹240 per month for 20 months. Calculate the maturity value of this account, if the bank pays interest at the rate of 10% per annum.

Answer 1

Installment per month(P) = ₹ 240
Number of months(n) = 20
Rate of interest(r) = 10% p.a.

Interest = $=P\times \frac{n(n+1)}{2\times 12}\times \frac{r}{100}=240\times \frac{20\left(21\right)}{2\times 12}\times \frac{10}{100}=420$
Maturity value = P$\times$n + Interest = 250$\times$20 + 420
= 5000 + 420 = 5420