Question

John lent Rs. 2550 to Mohan at 7.5 percent per annum. If Mohan discharges the debt after 8 months by giving an old black and white television and Rs. 1422.50; find the price of the television.

Answer 1

Given:

• Principal (P) = Rs. 2550,
• Rate (R) = 7.5% per annum,
• Time (T) = `8/12` = 0.6667 years,
• Cash paid = Rs. 1422.50.

Step 1: Calculate the simple interest

The formula for simple interest is:

`SI = (P.R.T)/100`

Substitute the values:

`SI = (2550xx7.5xx0.6667)/100`

= Rs. 127.50.

Step 2: Total debt to be repaid

Total debt = P + SI = 2550 + 127.50 = Rs.2677.50.

Step 3: Price of the television

The price of the television is the remaining amount after deducting the cash paid:

Price of television = Total debt − Cash paid.

Price of television = 2677.50 − 1422.50

= Rs. 1255.