A farmer buys a used tractor for Rs 12000. He pays Rs 6000 cash and agrees to pay the balance in annual installments of Rs 500 plus 12% interest on the unpaid amount. How much will be the tractor cost him?

Asked by Pragya Singh | 1 year ago |  133

1 Answer

Solution :-

Given, the farmer pays Rs 6000 in cash.

So, the unpaid amount = Rs 12000 – Rs 6000 = Rs 6000

From the question, the interest paid annually will be

12% of 6000, 12% of 5500, 12% of 5000, …, 12% of 500

Hence, the total interest to be paid = 12% of 6000 + 12% of 5500 + 12% of 5000 + … + 12% of 500

= 12% of (6000 + 5500 + 5000 + … + 500)

= 12% of (500 + 1000 + 1500 + … + 6000)

It’s seen that, the series 500, 1000, 1500 … 6000 is an A.P. with the first term and common difference both equal to 500.

Let’s take the number of terms of the A.P. to be n.

So, 6000 = 500 + (n – 1) 500

1 + (n – 1) = 12

n = 12

Now,

The sum of the A.P = 12/2 [2(500) + (12 – 1)(500)] = 6 [1000 + 5500] = 6(6500) = 39000

Hence, the total interest to be paid = 12% of (500 + 1000 + 1500 + … + 6000)

= 12% of 39000 = Rs 4680

Therefore, the tractor will cost the farmer = (Rs 12000 + Rs 4680) = Rs 16680

Answered by Abhisek | 1 year ago

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