Q.Mr. Sen deposits ₹500 every month in a Recurring Deposit account for 12 months at 8% per annum. Find the maturity value and the interest earned.

This is a direct application of the standard RD maturity-value formula, with the monthly instalment $P$, the tenure in months $n$, and the annual rate $r$.

$Pn = 500\times12 = 6{,}000$. …

Here $P = ₹500$ (monthly instalment), $r = 8\%$ per annum, $n = 12$ months.

Step 1 — Total instalments paid in.

Step 2 — Total interest, using the standard RD interest term.

$\frac{P\,r\,n(n+1)}{2400} = \frac{500\times8\times12\times13}{2400} = \frac{624{,}000}{2400} = ₹260$ …

A very common error is using $n(n+1)$ where $n$ is meant to be the exact number of months given, but forgetting the $+1$ — writing $n^2$ instead of $n(n+1)$ — which understates the interest; the $+1$ accounts for the fact that even the v …