2.Omega borrows Rs. 33,10,000 to finance the expenditure of his son’s education. The loan is to be repaid in three equal payments at the end of each of the next three years. The lender charges rate of interest at the rate of 10% per annum, compounded annually on the balance at the beginning of each year.
a.What is the amount of each payment Omega makes?
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Answer:
omega makes 14,34,333.4rs each year
Explanation:
10% of 33,10,000= 3,31,000
interest to be paid for 3 years = 3 ×3,31,000= 9,93,000
total amount including intrest = 33,10,000+ 9,93,000
= 43,03,000
amount to be paid each year = 43,03000÷3
= 14,34,333.4
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