Vaideesh deposits Rs. $500$ at the beginning of every month for $5$ years in a post office. If the rate of interest is $7.5$ %, find the amount he will receive at the end of $5$ years.

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Solution

Amount deposited every month, $P =$ $500$
Number of months, $n = 5 \times 12 = 60$ months
Rate of interest, $r = 7 \frac{1}{2}$ % $= \frac{15}{2}$ %
Total deposit made $= P n = 500 \times 60$
$=$ $30, 000$
Period for recurring deposit, $N = \frac{1}{12} [\frac{n (n + 1)}{2}]$ years
$= \frac{1}{24} \times 60 \times 61 = \frac{305}{2}$ years
Interest, $I = \frac{P N r}{100}$
$= 500 \times \frac{305}{2} \times \frac{15}{2 \times 100}$
$=$ $5, 718.75$
Total amount due $= P n + \frac{P N r}{100}$
$= 30, 000 + 5, 718.75$
$=$ $35, 718.75$

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Vaideesh deposits Rs. 500 at the beginning of every month for 5 years in a post office. If the rate of interest is 7.5%, find the amount he will receive at the end of 5 years.

Vaideesh deposits Rs. $500$ at the beginning of every month for $5$ years in a post office. If the rate of interest is $7.5$ %, find the amount he will receive at the end of $5$ years.