Question

A household article is available for Rs. 2,500 cash or Rs. 520 cash down payment followed
by four equal monthly instalments. If the rate of interest charged under the instalment plan is
25% per annum, find the amount of each instalment.

Answer 1

Answer:5 20

Step-by-step explanation:

Installments: =

4 + 25 (1+2+3)

......

12*100

4 + 25*6/12*100

4 + 25/200 = 825/200 = 33/8

33/8 = 2145

1 = 520

Answer 2

The amount of each installment will be Rs.520

GIVEN: A household article is available for Rs. 2,500 cash or Rs. 520 cash down payment followed by four equal monthly installments.
TO FIND The amount of each installment.
SOLUTION:

As we are given in the question,

A household article is available for Rs. 2,500 cash.

Rs. 520 cash down payment followed by four equal monthly installments.

The rate of interest charged under the installment plan is 25% per annum.

As we know,

The cash price of the article = Rs 2500

Cash down payment = Rs 520

Let the installment amount paid per month be Rs x

Number of installments = 4

Amount paid in installments = 520 + 4x

Interest paid = (520 + 4x – 2500) = (4x – 1980)

The buyer owes the seller for the first month = of 1980

The buyer owes the seller for the 2nd month = (1980 – x)

The buyer owes the seller for 3rd month = (1980 – 2x)

The buyer owes the seller for the 4th month = (1980 – 3x)

∴ Total principal for one month = [7920 – 6x]

Rate of interest = 25% p. a

Hence the installment amount per month is Rs 520.

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