Class 10 Banking (Recurring Deposit Accounts) Mock Test (ICSE)

Topics in Banking (Recurring Deposit Accounts)

• Recurring deposit accounts
• Interest on recurring deposit
• Maturity value
• Finding monthly instalment or time

Banking (Recurring Deposit Accounts) practice questions with answers

1. Q1Multiple choice·1 mark
   If the monthly instalment in a recurring deposit account is ₹ $500$ and the total interest earned at the time of maturity is ₹ $825$, then the maturity value of the account held for $15$ months is:

   1. (a)₹ $8325$
   2. (b)₹ $6675$
   3. (c)₹ $9150$
   4. (d)₹ $7500$
   Show answer and step marks

   1. Correct option: (a) ₹ $8325$+1

   Answer: (a)
2. Q2Multiple choice·1 mark
   In a Recurring Deposit account, the total principal for finding the interest for one month is calculated using the formula $\frac{P \times n(n + 1)}{2}$. Here, $n$ represents the:

   1. (a)rate of interest per annum
   2. (b)monthly instalment in rupees
   3. (c)total maturity value in rupees
   4. (d)total number of months the account is held
   Show answer and step marks

   1. Correct option: (d) total number of months the account is held+1

   Answer: (d)
3. Q3Multiple choice·1 mark
   Ritu opens a recurring deposit account with a bank and deposits ₹ $800$ per month for $2$ years. If the rate of interest is $6\%$ per annum, the interest earned by her is:

   1. (a)₹ $600$
   2. (b)₹ $1200$
   3. (c)₹ $4800$
   4. (d)₹ $2400$
   Show answer and step marks

   1. Correct option: (b) ₹ $1200$+1

   Answer: (b)
4. Q4Multiple choice·1 mark
   A person deposits ₹ $1000$ per month in a recurring deposit account for $n$ months at $12\%$ per annum simple interest. If the maturity value is ₹ $10550$, the value of $n$ is:

   1. (a)$12$ months
   2. (b)$15$ months
   3. (c)$8$ months
   4. (d)$10$ months
   Show answer and step marks

   1. Correct option: (d) $10$ months+1

   Answer: (d)
5. Q5Multiple choice·1 mark
   The maturity value of a recurring deposit account is

   1. (a)all instalments paid together with the total interest
   2. (b)all instalments paid, without any interest
   3. (c)interest earned during the first year only
   4. (d)first instalment with one month's interest
   Show answer and step marks

   1. Correct option: (a) all instalments paid together with the total interest+1

   Answer: (a)
6. Q6Short answer·2 marks
   Ravi runs a small kitchen garden and opens a recurring deposit account at a bank to save for a drip irrigation kit. The account runs for 2 years at $8\%$ per annum, and he deposits a fixed amount at the beginning of every month. At maturity he receives ₹ $26000$. Find the monthly instalment Ravi must deposit.
   Show answer and step marks

   1. Maturity value = total deposits + interest, where interest = $P \times \frac{n(n+1)}{2} \times \frac{1}{12} \times \frac{r}{100}$ with $n = 24$ months and $r = 8$+1
   2. Interest $= P \times \frac{24 \times 25}{2} \times \frac{1}{12} \times \frac{8}{100} = 2P$, so maturity $= 24P + 2P = 26P$+0.5
   3. $26P = 26000$, so $P = 1000$+0.5

   Answer: Monthly instalment = ₹ $1000$

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