A person buys a washig machme on the condition that he shall pay a sum of INR 5880 as cash down
payment and the same sum at the end of the first year and the two years. What is the total interest (in INR)
paid by him under this scheme, if the rate of interest is 5%, compounded yearly? (Nearest to a INR)
Answers
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Given :- A person buys a washig machine on the condition that he shall pay a sum of INR 5880 as cash down
payment and the same sum at the end of the first year and the two years. What is the total interest (in INR) paid by him under this scheme, if the rate of interest is 5%, compounded yearly? (Nearest to a INR)
solution :-
we have ,
- cash down payment = Rs.5880
and ,
- 1st and 2nd installment = Rs.5880 .
- Rate = 5% compounded yearly.
Let P1 and P2 is the Principal of for 1st and 2nd installment .
So,
→ 5880 = P1(1 + 5/100)
→ 5880 = P1(1 + 1/20)
→ 5880 = P1(21/20)
→ P1 = (5880 * 20)/21
→ P1 = Rs.5600 .
and,
→ 5880 = P2(1 + 5/100)²
→ 5880 = P2(1 + 1/20)²
→ 5880 = P2(21/20)²
→ P2 = (5880 * 400)/441
→ P2 = Rs.5333.33 .
therefore,
→ Cash Price of washing machine = 5800 + 5600 + 5333.33 = Rs.16813.33 .
and,
→ Amount Paid = 5880 * 3 = Rs.17640 .
Hence,
→ The total interest (in INR) paid by him = 17640 - 16813.33 = Rs.826.67 (Ans.)
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