Question

Bharathi borrows an amount of 12500 at 12% per annum for 3 years at a simple interest
and Madhuri borrows the same amount for the same time period at 10% per annum.
compounded annually. Who pays more interest and by how much?

Answer 1

Answer:

Madhuri pays more interest

Step-by-step explanation:

P = 12500

R = 10% for Madhuri and 12 for Bharati

T = 3 years

For Bharati

I=12500×12×3/100

=*4500

A=12500+4500

=*17000

For Madhuri

For the First Year1250

I=12500×10×1/100

=1250

A=12500+1250=13750

For the 2nd Year

I=13750×10×1/100

=1375

A=13750+1375

=15,125

For 3rd Year

I=15125×10×1/100

=1512.5

A= 15125+1512.5

=16,637.5

Bharati's Interest

Rupees 4500

Madhuri's Interest

(1+2+3) year interest=1250+1375+1512.5

=4137.5