A person earns Rs 2000 per month over and above his salary as additional charge allowance. However, 30 % of this additional income will be deducted as additional income tax at source. If the person would deposit Rs 1000 per month in a long-term saving fetching 12 % interest, his tax liability on the additional allowance would reduce to 10 %.
What is the effective interest for this person for money invested in the long-term savings scheme?
