subhash purchased a refrigerator on the term that he is required to pay rs 1500 cash down payment followed by rs 1020 at the end of first year, rs 1003 at the end of second year and rs 990 at the end of third year.interest is charged at the rate of 10% per annum compound interest.what is the price of the refrigerator?
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Answer:
Step-by-step explanation:
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Answer: Rs. 4000
Step-by-step explanation:
Cash down payment = Rs. 1500
Rate of interest p.a., R = 10%
Let’s assume,
Rs. “x” become Rs. 1020 at the end of 1st year
Rs. “y” becomes Rs. 1003 at the end of 2nd year
Rs. “z” become Rs. 990 at the end of the 3rd year
Now, we will calculate the values of x, y & z by using the formula of compound interest i.e.,
Amount = Principal * [1 + R/100]ⁿ
Therefore,
(i). 1020 = x[1 + 10/100]¹
⇒ 1020 = x * 1.1
⇒ x = Rs. 927.27
(ii). 1003 = y[1 + 10/100]²
⇒ 1003 = y * 1.21
⇒ y = Rs. 828.925
(iii). 990 = z[1 + 10/100]³
⇒ 990 = z * 1.331
⇒ z = Rs. 743.801
Hence,
The cash price of the refrigerator,
= Rs. 1500 + Rs. 927.27 + Rs. 828.925 + Rs. 743.801
= Rs. 3999.99
≈ Rs. 4000