Question

A man borrows certain sum of money at 5% compound interest per annum. He repays rs.3150 at the end of the 1st year and rs.4410 at the end of the 2nd year and he clears his entire loan. What is the sum of money he borrows?

Answer 1

Amount A=P(1+R/100)^n

R=rate of interest,n=time,P=Principal

A=4410+3150=7560Rs

7560=P(1+5/100)^2

7560=P(21/20)^2

P=7560×20×20/21×21

=6857 Rs