The annual payment of ₹700 in 5 years at the rate of 10%p.a. simple interest will discharge a debt of what amount?
Answer & explanation
Correct answer: option 2
The Best way to find the answer:
10% = \(\frac{1}{10}\) ⇒ *add one in every year.*
Year ⇒ 1st : 2nd : 3rd : 4th : 5th
10 : 11 : 12 : 13 : 14 ⇒ 60 (total)
1st year value is installment amount = 10R = 700 (given)
Sum of ratio is total amount = 60R = 700 x 6 = 4200