Compound Interest Practice Test 5

Question : 21 of 40

Marks: +1, -0

Sultan took a loan from the bank at 8% per annum and was supposed to pay a sum of Rs 2,240 at the end of 4 years. If the same sum is cleared off in four equal annual installments at the same rate, the amount of annual installment will be:

Rs 500
Rs 550
Rs 600
Rs 1,000

Validate

Solution:

Annual Installments

[{100A}/{100t+({rt(t-1)}/2)}]

={100×2240}/{(100×4)+({8×4(4-1)}/2)}

=224000/448=500

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