Question

Mr. Sam has a recurring deposit account and deposits ₹ 600 per month for 2 years. If he gets ₹ 15,600 at the time of maturity, find the rate of interest earned by him.

Answer 1

Let the rate of interest be r%.

Given,

P = ₹ 600 per month

n = 2 years or 24 months

M.V. = ₹ 15600

By formula,

M.V. = `P xx n + P xx ((n(n + 1))/(2 xx 12)) xx r/100`

Substituting values, we get:

`15600 = 600 xx 24 + 600 xx (24 xx (24 + 1))/(2 xx 12) xx r/100`

15600 = 14400 + 6 × 25 × r

15600 − 14400 = 6 × 25 × r

1200 = 150 r

r = `1200/150`

r = 8%