Question

Gautam takes a loan of Rs. 16000 for 2 yearsat 15% p.a. compound interest. He repays Rs. 9000 at the end of first year. How much must he pay at the end of second year to clear the debt?

Answer 1

Loan taken(P)= Rs. 16000
Rate(R)=15%p.a.
Time(T)= 2 years
$\therefore$ Interest for the first year
$=\frac{PTR}{100}=\frac{16000\times 15\times 1}{100}=Rs.2400$
Amount after one year=Rs. 16000 + 2400
=Rs. 18400
At the end of one year amount paid back
=Rs. 9000
Balance amount= Rs. 18400 -9000
=Rs. 9400
Interest for the second year= $\frac{9400\times 15\times 1}{100}$
=Rs. 1410
Amount after second year=Rs. 9400 +1410
=Rs. 10810