Question

Anita borrows ₹ 50000 from SBI at 11 % per annum, compounded annually. If she
repays ₹ 3500 at the end of first year and ₹ 27720 at the end of the second year, find
the amount of loan outstanding against her at the beginning of the third year.

Answer 1

Principle = Rs.50000

rate of interest, r = 11%

After 1 year, interest

$\frac{50000 * 11 * 1}{100}$

= 5500

After 1 year, total

50000 + 5500 = 55500

At the end of one year she repaid Rs.3500.

Total outstanding after 2 year

55500 - 5500 = 52000

After 2 year, interest

$\frac{52000 * 11}{100}$

Total=

52000-5720=46280

Outstanding at the beginning of the third year

= 46280-27720

=18560

Hence, the amount outstanding at the beginning of the third year is 18560.

(Ans)

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