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Question
Each of A and B both opened a recurring deposit accounts in a bank. If A deposited Rs. 1,200 per month for 3 years and B deposited Rs. 1,500 per month for 2 ½ years; find, on maturity, who will get more amount and by how much? The rate of interest paid by the bank is 10% per annum.
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Solution
For A
Installment per month (P) = Rs. 1,200
Number of months (n) = 36
Rate of interest (r) = 10% p.a.
∴ `S.I. = P xx (n(n + 1))/(2 xx 12) xx r/100`
= `1200 xx (36(36 + 1))/(2 xx 12) xx 10/100`
= `1200 xx 1332/24 xx 10/100`
= Rs. 6,660
The amount that A will get at the time of maturity
= Rs. (1,200 × 36) + Rs. 6,660
= Rs. 43,200 + Rs. 6,660
= Rs. 49,860
For B
Instalment per month (P) = Rs. 1,500
Number of months (n) = 30
Rate of interest (r) = 10% p.a.
∴ `S.I. = P xx (n(n + 1))/(2 xx 12) xx r/100`
= `1500 xx (30(30 + 1))/(2 xx 12) xx 10/100`
= `1500 xx 930/24 xx 10/100`
= Rs. 5,812.50
The amount that B will get at the time of maturity
= Rs. (1,500 × 30) + Rs. 5,812.50
= Rs. 45,000 + Rs. 5,812.50
= Rs. 50,812.50
Difference between both amounts = Rs. 50,812.50 – Rs. 49,860
= Rs. 952.50
Then B will get more money than A by Rs. 952.50
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