Question

Harsha borrowed ₹15000 from a bank to buy a scooter at a rate of 25% interest per annum compounded yearly. What will be the amount he pays at the end of 2 years?

• A. ₹ 23,437.5
• B. ₹ 28,497.6
• C. ₹ 43,417.3
• D. ₹ 32,421.1

Answer 1

The correct option is A ₹ 23,437.5

Given
Principal, $P=₹15,000$
Rate of interest, $r=25\%$
Number of years, $n=2$

We know that,
Amount, $A=P{[1+\frac{r}{100}]}^n$
$=15000{[1+\frac{25}{100}]}^2$
$=15000{[1+\frac{1}{4}]}^2$
$=15000{\left[\frac{5}{4}\right]}^2$
$=₹23,437.5$