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What annual payment will discharge a debt of Rs. 6450 due in 5 years at 10% per annum?
- a)Rs.1075
- b)Rs.1050
- c)Rs.1100
- d)Rs.1025
Correct answer is option 'A'. Can you explain this answer?
Verified Answer
What annual payment will discharge a debt of Rs. 6450 due in 5 years a...
Installment for first year = x
Installment for second year = 1.10x
Installment for third year = 1.20x
Installment for third year = 1.30x
Installment for final year = 1.40x
Total amount to be paid = (1 + 1.10 + 1.20 + 1.30 + 1.40) × x = 6450
∴ x = 6450 / 6 = 1075
Most Upvoted Answer
What annual payment will discharge a debt of Rs. 6450 due in 5 years a...
Given:
Principal amount (P) = Rs. 6450
Time period (n) = 4 years
Rate of interest (R) = 5% per annum
To calculate:
Annual payment to discharge the debt
Solution:
We can use the formula for calculating the annual payment of a loan or debt, which is:
Annual payment = (P * R) / [1 - (1 + R)^(-n)]
Where,
P = Principal amount
R = Rate of interest per annum
n = Time period
Substituting the given values in the formula, we get:
Annual payment = (6450 * 0.05) / [1 - (1 + 0.05)^(-4)]
Annual payment = (322.5) / [1 - 0.8227]
Annual payment = (322.5) / 0.1773
Annual payment = 1819.54
Rounding off to the nearest rupee, we get:
Annual payment = Rs. 1820
Therefore, the correct option is A) Rs. 1500.
Principal amount (P) = Rs. 6450
Time period (n) = 4 years
Rate of interest (R) = 5% per annum
To calculate:
Annual payment to discharge the debt
Solution:
We can use the formula for calculating the annual payment of a loan or debt, which is:
Annual payment = (P * R) / [1 - (1 + R)^(-n)]
Where,
P = Principal amount
R = Rate of interest per annum
n = Time period
Substituting the given values in the formula, we get:
Annual payment = (6450 * 0.05) / [1 - (1 + 0.05)^(-4)]
Annual payment = (322.5) / [1 - 0.8227]
Annual payment = (322.5) / 0.1773
Annual payment = 1819.54
Rounding off to the nearest rupee, we get:
Annual payment = Rs. 1820
Therefore, the correct option is A) Rs. 1500.
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What annual payment will discharge a debt of Rs. 6450 due in 5 years at 10% per annum?a)Rs.1075b)Rs.1050c)Rs.1100d)Rs.1025Correct answer is option 'A'. Can you explain this answer?
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