A recurring deposit account of Rs.1,200 per month has a maturity value of Rs.12,440. If the rate of interest is 8% and the interest is calculated at the end of every month, find the time (in months) of this Recurring Deposit Account.

# A recurring deposit account of Rs.1,200 per month has a maturity value of Rs.12,440. If the rate of interest is 8% and the interest is calculated at the end of every month, find the time (in months) of this Recurring Deposit Account.

1. A
6
2. B
8
3. C
10
4. D
12

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### Solution:

We will first identify the formula for calculating the total interest.
S.I. for n month
S.I. for 1 month
S.I. for n-1 months
Total S.I.=
We know that,
P=Rs.1200
Total amount Deposited= Monthly deposit
Maturity Value= Rs.12,440
We have the formula,
Total S.I.
Substituting the above values in the formula we get
Total S.I.
Total S.I.
Maturity Value= Total Deposited Amount + Total Simple Interest.

To simplify the equation we can divide it throughout by 4.

On factorization we will get,

Now, n is no months which cannot be negative.
Therefore, the acceptable value of n is 10.
So, option 3 is correct.

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