A Recurring Deposit Account of Rs 1,200 per Month Has a Maturity Value of Rs 12,440. If the Rate of Interest is 8% and the Interest is Calculated - Mathematics

Sum

A recurring deposit account of Rs 1,200 per month has a maturity value of Rs 12,440. If the rate of interest is 8% and the interest is calculated at the end of every month; find the time (in months) of this Recurring Deposit Account.

Solution

Installment per month(P) = Rs 1,200

Number of months(n) = n

Let rate of interest(r) = 8% p.a.

:. "S.I" = "P" xx ("n"("n" +1))/(2 xx 12) xx "r"/100

= 1200 xx ("n"("n" + 1))/(2 xx 12) xx 8/100

= 1200 xx ("n"("n" + 1))/24 xx8/100 = "Rs" 4"n"("n" + 1)

Maturity value = ₹ (1,200 × n) + ₹ 4n(n+1) = Rs (1200n+4n2+4n)

Given maturity value= ₹ 12,440

Then 1200n + 4n+ 4n = 12,440

=> 4"n"^2 + 1204"n" - 12440 = 0

=> "n"^2 + 301n - 3110 = 0

=> ("n" + 311)("n" - 10) = 0

=> n = -311 or n = 10 months

Then number of months = 10

Concept: Bank
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Chapter 2: Banking (Recurring Deposit Account) - Exercise 2 (A) [Page 24]

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Selina Concise Maths Class 10 ICSE
Chapter 2 Banking (Recurring Deposit Account)
Exercise 2 (A) | Q 9 | Page 24

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