Question

Rajiv lend out rs 9 to Anni on condition that the amount is payable in 10 months by 10 equal installments of rs. 1 each payable at the start of every month.what is the rate of interest per annum , if the first installment has to be paid one month from the date the loan is availed

Answer 1

Interest per annum = (10 - 9)/9
=1/9*100
11.11% p.a.

Answer 2

Answer:

2.22%

Step-by-step explanation:

₹ 9+ interest paid on ₹9 for 10 months = (₹ 1 + interest on ₹1 for 9 months) + ( ₹ 1 + interest on ₹ 1 for 8 months) + .......................................................( ₹1 + interest on ₹1 for 1 month) + (₹ 1) ₹9 + interest on ₹1 for 90 months - interest on ₹10 for 45 months = ₹ 10 - ₹9 = ₹1

now interest on ₹1 for 45 months = (1*R*45)/100

=R = 100/45

= R = 2.222%(answer)