A man purchase a bike and pays the amount at 20% rate of compound interest in 3 equal yearly installment of Rs. 10800 each. Find the price of the bike.
Answer & explanation
Correct answer: option 1
20% → \(\frac{1}{5}\)
Principal : Installment
1st ⇒ 5 : 6
2nd ⇒ 25 : 36
3rd ⇒ 125 : 216
* Installment amount for each year should be same*
Therefore,
Principal : Installment
1st ⇒ 5 : 6 ) × 36
2nd ⇒ 25 : 36 ) × 6
3rd ⇒ 125 : 216 ) × 1
Principal : Installment
1st ⇒ 180 : 216
2nd ⇒ 150 : 216
3rd ⇒ 125 : 216
Sum ⇒ 455 : 216 (Each Installment)
↓ ↓
×50 ×50
↓ ↓
22,750 10,800 (given)