Mathematics · Consumer Protection Calculations - Reversals and Costs
A consumer has a dispute over a 'Credit Card Statement' involving: - Disputed Transaction: ₹50,000 (claimed to be unauthorized). - Late Payment Fee: ₹1,000 per month (charged for 6 months). - Interest at 3.5% per month on the ₹50,000 for 6 months. The District Commission finds the transaction was unauthorized and reported on time. It orders the bank to: (a) Reverse the ₹50,000 and all fees/interest. (b) Pay ₹25,000 as compensation. (c) Pay ₹5,000 as litigation costs. Calculate the total 'Reversal Amount' the bank must process in the statement (Principal + Interest + Fees) and the total 'Cash Outflow' (Compensation + Costs) the bank must pay. (Assume simple interest: 3.5% × 6 months = 21%).
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Reversal: ₹66,500; Cash Outflow: ₹25,000
- 2Reversal: ₹56,000; Cash Outflow: ₹30,000
- 3Reversal: ₹61,500; Cash Outflow: ₹30,000
- 4Reversal: ₹66,500; Cash Outflow: ₹30,000✓
Correct answer
Reversal: ₹66,500; Cash Outflow: ₹30,000
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