Question

Ramesh deposits rs 2,400 per month in a recurring deposit scheme of a bank for one year. If he gets rs 1,248 as interest at the time of maturity, find the rate of interest. Also, find the maturity value of this deposit. ​

Answer 1

The rate of interest is 8% and the maturity value of a recurring deposit is Rs. 30048.

Given:

The time period in months (n) = 1 year = 12 months.

S.I. = Rs. 1248.

Principal (P) = Rs. 2400 per month.

To find:

The rate of interest and the maturity value of a recurring deposit needs to be determined.

Solution:

Knowing the formula for simple interest for recurring deposit accounts.

S.I. = P × n × $\frac{(n+1)}{24}$ × R%.

where P is per month principal.

Putting all the given values.

⇒ 1248 = 2400 × 12 × $\frac{(12+1)}{24}$ × R%.

⇒ 1248 = 100 × 12 × 13 × R%.

⇒ 1248 = 100 × 12 × 13 × $\frac{R}{100}$.

⇒ R = $\frac{1248}{156}$ = 8%.

∴ The rate of interest is 8%.

Knowing that, Maturity value (M.V.) = Principal in a year + Interest

⇒ M.V. = 2400 × 12 + 1248

⇒ M.V. = 28800 + 1248.

⇒ M.V. = Rs. 30048.

Hence, the maturity value will be Rs. 30048.

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