Question

A man borrow Rs 10,000 at 10% compound interest compounded yearly. At the end of each year, he pays back 30% of the sum borrowed. How much money is left unpaid just after the second year?

Answer 1

For 1st year
P = Rs 10,000; R = 10% and T = 1 year
Interest = Rs $\frac{10,000\times 10\times 1}{100}=$ Rs 1,000
Amount at the end of 1st year = Rs 10,000 + Rs 1,000 = Rs11,000
Money paid at the end of 1st year = 30% of Rs 10,000 = Rs 3,000
$\therefore$ Principal for 2nd year = Rs 11,000 - Rs 3,000 = Rs, 8,000
For 2nd year
P = Rs8,000; R = 10% and T = 1 year
Interest = Rs $\frac{8,000\times 10\times 1}{100}=$ Rs 800
Amount at the end of 2nd year = Rs 8,000 + Rs 800 = Rs 8,800
Money paid at the end of 2nd year = 30% of Rs 10,000 = Rs 3,000
$\therefore$ Principal for 3 rd year = Rs 8,800 - Rs 3,000 = Rs 5,800.