Shamshad Ali buys a scooter for Rs 22000. He pays Rs 4000 cash and agrees to pay the balance in annual instalments of Rs 1000 plus 10% interest on the unpaid amount.
Shamshad Ali buys a scooter for Rs 22000. He pays Rs 4000 cash and agrees to pay the balance in annual instalments of Rs 1000 plus 10% interest on the unpaid amount. How much the scooter will cost him.
Cost of the scooter = Rs 22000
Shamshad Ali pays Rs 4000 in cash.
$\therefore$ Unpaid amount $=$ Rs $22000-$ Rs $4000=$ Rs 18000
Number of years taken by Shamshed Ali to pay the whole amount $=18000 \div 1000=18$
He agrees to pay the balance in annual instalments of Rs 1000 plus 10% interest on the unpaid amount.
Total amount of instalments:
$10 \%$ of Rs $18000+10 \%$ of Rs $17000+10 \%$ of Rs $16000 \ldots$
$=1800+1700+1600 \ldots$
It is in an A.P. where $a=1800, d=-100$ and $n=18$.
Therefore, total amount of instalments:
$\frac{18}{2}[2 \times 1800+(18-1) \times-100]$
$=9[3600-1700]$
$=\operatorname{Rs} 17100$
∴ Total amount Shamshad Ali has to pay = Rs (22000 + 17100) = Rs 39100