Question

3. Ram borrows Rs. 50,000 now and agrees to repay Rs. 10,000 in 2 months and Rs.
16,000 in 6 months. What final payment should he make at the end of 18 months to
settle down his indebtness, at 12% simple interest, assuming that the focal date is
today?
​

Answer 1

Explanation:

Given : P=5500,R=20%,n=2 To find A

A=P(1+

100

R

)

n

=5500(1+

100

20

)

2

=5500(1+

5

1

)

2

=5500(

5

6

)

2

=

25

5500×36

∴A=7920

This amount is to be paid in two equal instalments

So, each instalment =

2

7920

=3960.

Hence, each instalment is Rs. 3,960.