Question

Mrs. Mathew opened a Recurring Deposit Account in a certain bank and deposited ₹ 640 per month for 4 ½ years. Find the maturity value of this account, if the bank pays interest at the rate of 12% per year.

Answer 1

Installment per month (P) = Rs. 640

Number of months (n) = 54

Rate of interest (r) = 12% p.a.

∴ ${\displaystyle S.I.=P\times \frac{n(n+1)}{2\times 12}\times \frac{r}{100}}$

= ${\displaystyle 640\times \frac{54(54+1)}{2\times 12}\times \frac{12}{100}}$

= ${\displaystyle 640\times \frac{2970}{24}\times \frac{12}{100}}$

= Rs. 9,504

The amount that Manish will get at the time of maturity

= Rs. (640 × 54) + Rs. 9,504

= Rs. 34,560 + Rs. 9,504

= Rs. 44,064