Shamshad Ali buys a Scooter for ₹ 22000. He pays ₹ 4000 cash and agrees to pay the balance in annual instalments of ₹ 1000 plus 10% interest on the unpaid amount. How much the Scooter will cost him?
Given: Price of the scooter is Rs. 22000. He pays ₹ 4000 cash and agrees to pay the balance in annual instalments of Rs. 1000 plus 10% interest on the unpaid amount.
To find: Total cost of the scooter if he buys it at installment
Total price = 22000
Paid amount = 4000
Unpaid amount = 22000 – 4000 = 18000
He pays remaining 18000 in n number of installments of 1000 each
Cost incurred by him to pay remaining 18000,
Formula used:
where a is first term, d is common difference and n is number of terms in an A.P.
Therefore,
= 35100
Total cost = 4000 + 35100 = 39100
Hence, total cost of the scooter if he buys it at installment is Rs. 39100