Question

Mr. Dubey borrows 100000 fro State Bank of India at 11% per annum compound interest . He repays 41000 at the end of first year and 47700 at the end of second year. Find the amount outstanding at the beginning of the third year.

Answer 1

It is given that

Borrowed money (P) = 1000000

Rate = 11% p.a

Time = 1 year

We know that

Amount after first year = Prt/100

Substituting the values

= $100000+11000$

= $111000$

Amount paid at the end of first year = 41000

So the principal for second year = 111000 - 41000

= 70000

We know that

Amount after second year = $P+(70000\times 11)/100$

By further calculation

= $70000+700$

= $77700$

So the amount paid at the end of second year = 47700

Here the amount outstanding at the beginning year = $77700-47700$

=$30000$