Calculate maturity value and interest on recurring deposit accounts using the standard banking formula.
Interest on a recurring deposit = PĆn(n+1)/2 Ć r/(12Ć100), where P is monthly instalment, n is number of months, and r is annual rate.
Find the interest on a RD of ā¹500/month for 12 months at 8% per annum.
I=500Ć12Ć13/2Ć8/(12Ć100)=500Ć78Ć8/1200=ā¹260
Find the maturity value of the above RD.
Total deposit=500Ć12=6000; maturity=6000+260=ā¹6,260
RD problems often require working backward from the maturity value or interest to find the monthly instalment or rate.
A person deposits ā¹300/month in an RD for 2 years (24 months) at 6% per annum. Find the interest earned.
I=300Ć24Ć25/2Ć6/(12Ć100)=300Ć300Ć6/1200=ā¹450
Find the maturity value for the above RD.
Total deposit=300Ć24=7200; maturity=7200+450=ā¹7,650
1. Find the interest on a RD of ā¹1,000/month for 12 months at 10% per annum.
2. Find the maturity value of the above RD.
3. Find the interest on a RD of ā¹200/month for 24 months at 8% per annum.
4. Find the maturity value for the above RD.
5. A RD of ā¹400/month for 12 months has a maturity value of ā¹5,000. Find the interest earned.