... He is considering the following alternatives to accumulate the funds required:
i.
ii.
Deposit a fixed sum in bank at the beginning of every year for five years, will fetch him on maturity an amount equal to Rs.10 lakh. Bank pays him interest at the rate of 12% p.a.
Buy a plot now by borrowing the amount required to buy it and sell it after 5 years so price is expected
that it realizes Rs.10 lakh. He has identified an area in which the mar after 5 years so
to grow at the rate of 24% per annum. The purchase price is repayable in 5 equal installments at the beginning of each year, the first installment being paid now. The loan carries interest at the rate of 18% p.a.
What is the outflow of funds required for Mr. Rajan Lal under both the options?
a.
1.00 lakh; 0.90 lakh.
b.
1.41 lakh; 0.92 lakh.
C.
1.42 lakh; 0.95 lakh.
d.
1.45 lakh; 0.95 lakh.
Reserved. IS
e. 1.47 lakh; 0.97 lakh