Question

Question 6 (i)
Arif took a loan of Rs 80,000 from a bank. If the rate of interest is 10% per annum, find the difference in amounts he would be paying after $1\frac{1}{2}$ Years if the interest is:
(i) Compounded annually

Answer 1

(i) Here , Principal (P) = Rs 80,000, Time (n) =1 Years , Rate of interest (R) = 10%
Amount for 1 year (A) = $P{(1+\frac{R}{100})}^n=80000{(1+\frac{10}{100})}^1=80000{\left(\frac{11}{10}\right)}^1$
=Rs 88,000
Interest for $\frac{1}{2}year=\frac{88000\times 10\times 1}{100\times 2}=Rs.4,400$
Total amount = Rs 88,000 + Rs 4,400 = Rs 92,400