Question

A washing machine is available for Rs. 13,500 cash or Rs. 6,500 as cash down
payment followed by three monthly instalments of Rs. 2,500 each. Find the rate of
interest charged under instalment plan

Answer 1

Answer:

Cost of machine CP = 13500

If machine bought using installment plan, then machine will cost = 6500 + 3*2500

= 6500 + 7500

= 14000

Let rate of interest on installment plan be R

Thus,

14000 - 13500 = 13500*R*1/100

500 = 135*R

R = 500/135 = 3.7 %

Answer 2

ANSWER

Let r% p.a. be the rate under installment scheme. After Rs 600 cash is paid, Rs 1200 remained to be paid.

This becomes Rs 1,220. Total interest paid is Rs 20.

Now Rs 1,200 is kept for one month and Rs 600 is kept for one month.

⇒ Rs 600 is kept for 3 months at r% and interest paid is Rs 20.

$\therefore 20 = 600 \times \frac{3}{12} \times \frac{r}{100}$

$= > r = \frac{40}{3} = 13.33\%$