Question

In the case of recurring deposits, interest is compounded .....................

• A. Half yearly
• B. Quarterly
• C. Monthly
• D. Annually

Answer 1

Answer:

B. Quarterly

Recurring or Cumulative Deposit:

• To encourage the habit of thrift and savings among people

• A depositor deposits a small fixed sum in the multiples of 5 or 10 in his account every month particular period. 

• The depositor gets the pre-determined sum after the period of deposits with sum invested and cumulative interest. 

• The amount of interest is adjusted quarterly 

• Recurring Deposit is a Term deposit in which investor has to deposit money in short intervals for long time 

• The tenure of Recurring between 6 months to 10 years. 

• Same amount of repeated investment at fixed intervals