... him at the end of the period Rs.616.25.if the simple interest is 5% per year, the sum deposited each month is
Answers (2)
It depends on how often the interest is compounded but we'll assume monthly. If the yearly interest is 5% and it is compounded 12 times a year then the monthly interest is the 12th root of 5, which is 1.1435298360829202%
If we think of the sum x which is added each month, there are twelve sums with the interest compounded from one to twelve times so:
1.1435298360829202
1.3076604860118303
1.4953487812212201
1.7099759466766963
1.9554085140089388
2.2360679774997883
2.5570104477805998
2.9240177382128636
3.3437015248821069
3.8236224566586460
4.3724263611058341
5.0000000000000000
The average interest earned on a sum (and on the whole total because interest is a ratio) is: 2.655730839178%
So if 616.25 is 102.655730839178%, then 100% is 600.3. We can assume the .3 is a rounding error and the deposit was there 50 per month.
P.S. A rounding error of 0.05% from 12 compounds can come from an error as little as 0.0042% in the first compound (rounding to the fifth decimal place).