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A man purchased a house valued at Rs. 3,00,000. He paid Rs. 2,00,000 at the time of purchase and agreed to pay the balance with interest at 12% par annum compounded half yearly in 20 equals half yearly instalment If the first instalment is paid after six months from the date of purchase then the amount of each instalment is a) Rs. 8,719 b) Rs. 8,769 c) Rs. 7,893 d) None of these?
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A man purchased a house valued at Rs. 3,00,000. He paid Rs. 2,00,000 a...
Calculation of Remaining Balance

The first step in solving this problem is to calculate the remaining balance that the man has to pay after making the initial payment of Rs. 2,00,000. To do this, we subtract the initial payment from the total value of the house:

Remaining balance = Rs. 3,00,000 - Rs. 2,00,000 = Rs. 1,00,000

Calculation of Interest Rate

The next step is to calculate the interest rate that the man has to pay on the remaining balance. The interest rate is 12% per annum compounded half yearly. This means that the interest rate for each half year is:

Interest rate = 12% / 2 = 6%

Calculation of Number of Instalments

The man has to pay the remaining balance in 20 equals half yearly instalments. This means that he has to pay the balance over a period of 10 years, with an instalment due every 6 months.

Calculation of Instalment Amount

To calculate the amount of each instalment, we can use the formula for the present value of an annuity:

P = (A * (1 - (1 + r)^-n)) / r

Where P is the present value of the annuity, A is the annuity payment, r is the interest rate per period, and n is the number of periods.

In this case, P is the remaining balance of Rs. 1,00,000, r is 6% per half year, and n is 20 half years. We need to solve for A, which is the amount of each instalment.

Substituting the values, we get:

1,00,000 = (A * (1 - (1 + 0.06)^-20)) / 0.06

Solving for A, we get:

A = Rs. 8,719.16

Therefore, the amount of each instalment is Rs. 8,719.16.

Conclusion

The correct answer is option (a) Rs. 8,719. To solve this problem, we needed to calculate the remaining balance, the interest rate, the number of instalments, and the amount of each instalment using the formula for the present value of an annuity.
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A man purchased a house valued at Rs. 3,00,000. He paid Rs. 2,00,000 at the time of purchase and agreed to pay the balance with interest at 12% par annum compounded half yearly in 20 equals half yearly instalment If the first instalment is paid after six months from the date of purchase then the amount of each instalment is a) Rs. 8,719 b) Rs. 8,769 c) Rs. 7,893 d) None of these?
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A man purchased a house valued at Rs. 3,00,000. He paid Rs. 2,00,000 at the time of purchase and agreed to pay the balance with interest at 12% par annum compounded half yearly in 20 equals half yearly instalment If the first instalment is paid after six months from the date of purchase then the amount of each instalment is a) Rs. 8,719 b) Rs. 8,769 c) Rs. 7,893 d) None of these? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A man purchased a house valued at Rs. 3,00,000. He paid Rs. 2,00,000 at the time of purchase and agreed to pay the balance with interest at 12% par annum compounded half yearly in 20 equals half yearly instalment If the first instalment is paid after six months from the date of purchase then the amount of each instalment is a) Rs. 8,719 b) Rs. 8,769 c) Rs. 7,893 d) None of these? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A man purchased a house valued at Rs. 3,00,000. He paid Rs. 2,00,000 at the time of purchase and agreed to pay the balance with interest at 12% par annum compounded half yearly in 20 equals half yearly instalment If the first instalment is paid after six months from the date of purchase then the amount of each instalment is a) Rs. 8,719 b) Rs. 8,769 c) Rs. 7,893 d) None of these?.
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