Simple & Compound Interest · Question 15 · Hard
Suresh borrows ₹4,200 at 10% per annum compound interest and repays it in 2 equal annual instalments. What is the value of each instalment?
- ₹2,310
- ₹2,200
- ₹2,541
- ₹2,420
Answer and explanation
Answer: D. ₹2,420
Explanation: If each instalment is x, then x/1.1 + x/1.21 = 4,200, i.e. x × 2.1/1.21 = 4,200. So x = 4,200 × 1.21 ÷ 2.1 = ₹2,420.
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