Question

Ramu buys a watch whose cost is Rs. $\mathrm{9,000}$. He decides to pay Rs. $825$ monthly for a period of $12$ months. Calculate the rate of interest charged.

• A. $12\%$
• B. $5\%$
• C. $10\%$
• D. $15\%$

Answer 1

Answer: (C)

$10\%$

Here, $P=$ Rs. $9,000,T=12$ months $=1$ year and $E.M.I.=$ Rs. $825$.

$\Rightarrow$ $I=\frac{P\times R\times T}{100}=\frac{9000\times R\times 1}{100}=90R.$

$\Rightarrow$ $E.M.I.=\frac{P+I}{\text{Months}}$

$\Rightarrow$ $825=\frac{9000+90R}{12}$

$\Rightarrow$ $825\times 12=9000+90R$

$\Rightarrow$ $9900=9000+90R$

$\Rightarrow$ $90R=900$

Thus $R=\frac{900}{90}=10\%$