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ICSE Class 10 Mathematics Question 3 of 49

Multiple-Choice Questions — Question 3

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Question

Question 3

₹ P is deposited for n number of months in a recurring deposit account which pays interest at the rate of r% per annum. The nature and time of interest calculated is :

  1. compound interest for n number of months

  2. simple interest for n number of months

  3. compound interest for one month

  4. simple interest for one month

Answer

In a recurring deposit account,

By formula,

Interest = P×n(n+1)2×12×r100P \times \dfrac{n(n + 1)}{2 \times 12} \times \dfrac{r}{100}

∴ The nature and time of interest calculated is simple interest for one month.

Hence, Option 4 is the correct option.