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A Page from the Saving Bank Account of Priyanka is Given Below:If the Interest Earned by Priyanka for the Period Ending September, 2006 is Rs. 175, Find the Rate of Interest.

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Question

A page from the saving bank account of Priyanka is given below:

Date Particulars Amount
withdrawn(₹)
Amount deposited
(₹)
Balance
(₹)
3/4/2006 B/F - - 4,000·00
5/4/2006 By Cash - 2,000·00 6,000·00
18/4/2006 By cheque - 6,000·00 12,000·00
25/5/2006 To cheque 5,000·00 - 7,000·00
30/5/2006 By cash - 3,000·00 10,000·00
20/7/2006 By self 4,000·00 - 6,000·00
10/9/2006 By cash - 2,000·00 8,000·00
19/9/2006 To cheque 1,000·00 - 7,000·00

If the interest earned by Priyanka for the period ending September 2006 is Rs. 175, find the rate of interest.

Sum
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Solution

Principal for the month of April                =   ₹ 6,000
Principal for the month of May                 =   ₹ 7,000
Principal for the month of June                =  ₹ 10,000
Principal for the month of July                 =    ₹ 6,000
Principal for the month of August            =   ₹ 6,000
Principal for the month of September      =   ₹ 7,000
Total Principal for one month                   =  ₹ 42,000
P = ₹ 42,000,
R = r% per annum, T = `(1)/(12)`
I = ₹ 175

Thus,
I = `"PRT"/(100)`

175 = `(42,000 xx  r)/(100) xx (1)/(2)`

r = `(175 xx 12)/(420)`

= 5%

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