Question

Rita has a recurring deposit in a bank at $4\%$ per annum simple interest. If she pay monthly installment s Rs.$1000$ for annually. Find her Maturity value.

• A. $3019.97$
• B. $4019.97$
• C. $2019.97$
• D. $5019.97$

Answer 1

The correct option is A $3019.97$

Using the formula,
$M=\frac{R\times \left[\right(1+i{)}^n-1]}{1-(1+i{)}^{\frac{-1}{3}}}$
$R$= Monthly Installment $=1000$
$i=$ Rate of Interest/ 400 $=\frac{4}{400}$
$n=$ Number of Quarters $=1$
Substitute the values,
$M=\frac{1000\times \left[\right(1+4/400{)}^n-1]}{1-(1+4/400{)}^{\frac{-1}{3}}}$
$M=\frac{1000\times \frac{4}{400}}{1-(\frac{404}{400}{)}^{-1/3}}$
$M=3019.97$