Question

Ajay an unemployed graduate young man got rupees5000as loan from a bank. if the rate of interest is just 4%per annum compounded annually what amount will he pay after 2years? ​

Answer 1

Given:

Ajay an unemployed graduate young man got rupees5000as loan from a bank

To find:

The amount will he pay after 2years

Solution:

We have given to find the amount after the interest to pay the total debt

here we have the case of the compound interest

the formula to get the amount is given by:

$Amt = P(1+\frac{R}{100})^{T}$

Where,

P = ₹5000

R = 4%

T = 2 years

$Amt = 5000(1+\frac{4}{100})^{2}$

$Amt = 5000(1+\frac{1}{25})^{2}$

$Amt = 5000(\frac{26}{25})^{2}$

Amt = ₹ 5408

The amount he pays after 2years is ₹5408