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 1000 plus 10% interest on the unpaid amount.How much the scooter cost him?

Total cost of tractor = Rs. 12000

Paid Cash = Rs. 6000

Balance = Rs. (12000 - 6000) = Rs 6000

Number of installments @ Rs. 1000 each = 6

 

Interest on 1st installment

Hence, 1st installment = Rs (1000+600) = Rs 1600

 

Interest on 2nd installment

Hence, 2nd installment = Rs (1000+500) = Rs 1500

 

Interest on 3rd installment

Hence, 3rd installment = Rs (1000+400) = Rs 1400 and so on.

 

Total amount paid in installments = Rs (1600 + 1500 + 1400 +....... 6 terms)

Here, a = 1600, d = -100 and n = 6

 

Thus, Amount paid by farmer = Rs (6000 + 8100) = Rs. 14,100