A computer is sold either for Rs.19200 cash or for Rs.4800 cash down payment together with five equal monthly

Question

A computer is sold either for Rs.19200 cash or for Rs.4800 cash down payment together with five equal monthly installments. If the rate of interest charged is 12% per annum compounded anually, then the amount of each installment (nearest to a rupee) is:

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Accepted Answer

Rs.2965. Amount on which interest will be charged = 19200 - 4800 = 14400 The total amount paid will be equal to the sum of all monthly instalments. Therefore, we have 14400 ∗ k 5 a = I ( k 4 a + k 3 a + k 2 a + k a + 1 ) 14400*k^{5a} = I (k^{4a} +k^{3a}+k^{2a}+k^{a}+1 ) 14400 ∗ k 5 a = I ( k 4 a + k 3 a + k