A person wants income of Rs 6000 per year for 20 years. How much money should be deposited to him, if there are 5% annual interest on the invested funds.
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This is a problem of simple interest
He wants 6000 rupees a year
This means the interest value for a year should be 6000 rupees
So,
Total interest for 20 years
= 20*6000
=120000
Now ,
Interest amount = (pnr)/100
where p is principal amount
r is rate of interest and t is the time taken
So,
120000=(p*20*5)100
p=120000
So,he should deposit 120000 rupees
He wants 6000 rupees a year
This means the interest value for a year should be 6000 rupees
So,
Total interest for 20 years
= 20*6000
=120000
Now ,
Interest amount = (pnr)/100
where p is principal amount
r is rate of interest and t is the time taken
So,
120000=(p*20*5)100
p=120000
So,he should deposit 120000 rupees
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