Question

10. Rishi borrowed ₹20,000 for 3 years at the rate of 8.5% pa. simple Interest, while John borrowed the same amount for the same period at 8% pa. compounded annually. who paid less interest and by how much?​

Answer 1

Answer:

Given that,

P=Rs.20,000

R=8%

T=2years

As compounded annually, n=2.

Amount at the end of 2 years =P(1+

100

R

​

)

n

=20000(1+

100

8

​

)

2

=20000×

100

108

​

×

100

108

​

=Rs.23,328

Compound Interest (C.I) =23328−20000=Rs.3328

Step-by-step explanation: