Question

a man borrows Rs 12000 at a compound interest rate of 8% p.a. for 2 years. the lender puts the condition that if the borrower fails to clear off his debt by the end of 2 years, he will increase the rate of interest to 10% p.a. how much money will the man have to pay at the end of 3 years to clear off his debt?

Answer 1

Dear student
$$\begin{gathered} Amount=P{\left(1+\frac{R_1}{100}\right)}^2\left(1+\frac{R_2}{100}\right) \\ A=12000{\left(1+\frac{8}{100}\right)}^2\left(1+\frac{10}{100}\right) \\ A=12000{\left(1.08\right)}^2\left(1.1\right) \\ A=15396.48 \\ CompoundInterest=Rs\left(12000-15398.48\right)=Rs3396.48 \end{gathered}$$
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