Question

borrowed 8000₹ from geeta at 5 per annum simple interest for for 3 year had I borrowed this sum at 5% per annum compounded annually what extra money would I have to pay​

Answer 1

Answer:

The extra amount to be paid = Rs. 9261 - Rs. 9200 = Rs. 61

Step-by-step explanation:

Principal = Rs. 8000

Rate = 5 %

Years = 3

If borrowed at Simple Interest

SI = PRT/100

   =( 8000 X 5 X 3)/100

   = Rs. 1200

Total Amount to repay = Principal + SI = Rs. 8000 + Rs. 1200 = Rs. 9200

If borrowed at Compound Interest

A = P * (1 + r/100) ⁿ

   = 8000 * (1 + 5/100)³

   =8000 X $\frac{105}{100}$ X $\frac{105}{100}$ X $\frac{105}{100}$

   = (8 X 105 X 105 X 105)/1000

    = Rs. 9261

The extra amount to be paid = Rs. 9261 - Rs. 9200 = Rs. 61