when total cash price and installments are given, but rate of interest is not given :
what is the procedure of calculation of total interest and interest on each installment .solve the given questions.
1)cash price of a machine is rs 1900.payment is to be made in 3 equal installment of rs 800 each.
Answers
Answer:
Total interest = ₹501
Interest per installment = ₹167
Rate of interest = 26.37% (approx)
Explanation:
Price of machinery = ₹1,900
Payment to be made in 3 equal installments.
So, Principal per installment
= ₹1,900/3
= ₹633
Payment on each installment = ₹800
Interest paid each installment = (₹800-₹633) = ₹167
Total interest paid = ₹167 × 3times
= ₹501
Rate of interest = ₹501/₹1900 × 100
= 26.37% (approx)
Total interest = ₹500
interest on each will be Rs 166
rate of interest = 26.31%
here,
principle amount = ₹1900
the sum of all payments made will be 800*3 = ₹2400
the amount of interest= 2400-1900
= 500
rate of interest = interest/principal amount * 100
= 500/1900*100
= 26.31%
amount of interest on each payment = 500/3
= ₹166.