Question

Suresh bought a new mobile for a certain amount and agreed to pay the amount in three equal annual installments of Rs.2160 each at the rate of 20% per annum compound interest. What is the cost price of the mobile?

• A. Rs. 6000
• B. Rs. 5550
• C. Rs. 5000
• D. Rs. 4550

Answer 1

The correct option is D Rs. 4550

Let the cost price of the mobile be Rs. X, then

$X=\frac{2160}{(1+\frac{20}{100})}+\frac{2160}{{(1+\frac{20}{100})}^2}+\frac{2160}{{(1+\frac{20}{100})}^3}$

$\Rightarrow X=1800+1500+1250=4550$