Question

A farmer borrow from a bank $8000 at 5% simple interest. If he returns $3000 after 2 years. find the amount he has to pay at the end of 4 years, to settle the loan.

Answer 1

Borrowed Amount (P) = 8000
Interest Rate (I) = 5%

Interest for 2 years,

N=2

Interest = (PxIxN) /100 = (8000x5x2)/100=800.

Total Repayable amount after 2 years = 8800.

If he pay 3000, Remaining Money = 8800-3000 = 5800

He settles the loan two years thereafter, so he pays 5800 and its interest at 5% for 2 years

Interest = (5800x5x2)/100 = 580.

Total amount Payable = 5800+580 = 6380

Answer 2

Answer:

Step-by-step explanation:

Borrowed Amount (P) = 8000

Interest Rate (I) = 5%

time = 4 years

simple Interest = (PxRxT) /100 = (8000x5x4)/100=1600.

Total Repayable amount after 4 years = 9600.

If he pay 3000 in two year (but simple interest remain same at 8000), hence

Remaining Money = 9600-3000 = 6600

to settles the loan,

so he pays 6600