Practicing Success
A cycle costs Rs.1500. If Rs. 350 was paid as cash payment and rest amount was to be paid in 3 monthly installments of Rs.400. Find the rate of interest p.a. |
25% 26.66% 27.5% 29.5% |
26.66% |
Given: Price of Bicycle = 1500 Down Payment = 350 Payment in 3 installments = 3 × 400 = 1200 SI = \(\frac{PRT}{100}\) Total amount = 1200 + 350 = 1550 ⇒ Interest Paid = 1550 – 1500 = 50 Principal for the first month = 1500 – 350 = 1150 Principal for the second month = 1150 – (350 + 50) = 750 Principal for the third month = 750 – (350 + 50) = 350 ∴ Total Principal = 1150 + 750 + 350 = 2250 Rate of interest will be the same throughout 3 years Time = \(\frac{1}{12}\) years S.I = (2250 × (1/12) × R)/100 = 50 ∴ R = \(\frac{80}{3}\) % = 26.66% |