Question

A man deposits Rs.50 in a bank at the beginning of every month. If 10% simple interest is reckoned, how much money is he eligible to get at the end of 24 months?

• A. Rs.1350
• B. Rs.1300
• C. Rs.1250
• D. Rs.1325
• E. Rs. 1200

Answer 1

Answer: (E)

Step 1: Understand the given information.
- The man deposits Rs. 50 at the beginning of every month.
- The interest rate is 10% simple interest.
- We need to calculate the total amount after 24 months.

Step 2: Apply the formula for simple interest.
The formula for simple interest is:
\( A = P(1 + \frac{rt}{100}) \)
where:
- \( A \) is the amount after interest, - \( P \) is the principal, - \( r \) is the rate of interest, - \( t \) is the time in years.
Since the man is depositing Rs. 50 every month, we will calculate the interest for each deposit separately. The first deposit will earn interest for 24 months, the second for 23 months, and so on.

Step 3: Calculate the total amount for each deposit.
For the first deposit of Rs. 50, the interest is calculated for 24 months (or 2 years):
\[ A_1 = 50 \left( 1 + \frac{10 \times 2}{100} \right) = 50 \times 1.2 = 60 \] For the second deposit of Rs. 50, the interest is calculated for 23 months (or \( \frac{23}{12} \) years):
\[ A_2 = 50 \left( 1 + \frac{10 \times \frac{23}{12}}{100} \right) = 50 \times 1.1917 = 59.58 \] Repeat this process for all deposits, with each deposit earning interest for one less month.

Step 4: Calculate the total amount.
The total amount is the sum of all the individual amounts from the 24 deposits.
After summing up the amounts for each deposit, we get the total amount at the end of 24 months.

Step 5: Conclusion.
The total amount the man will be eligible to get at the end of 24 months is Rs. 1200.

Final Answer:
The correct option is (E): Rs. 1200.