Question

fabina borrows Rs 12500 at 12% per annum for 3 years at simple interest and Radha borrows the same period at 10% per annum, compounded annually.who pays more interest and by how much?​

Answer 1

Answer:Fabina,₹362.5

Step-by-step explanation:

Interest for Radha=P*(1+R/100)³ -P

=12500*110*110*110/100*100*100-12500

=12500*11*11*11/10*10*10-12500

=12.5*11*11*11-12500

=8708-12500

=₹16,637.5-₹12500

=₹4,137.5

Interest for fabina=12500*12*3/100

=125*12*3

=₹4,500

Fabina paid more by=4500-4137.5

=₹362.5

Answer 2

Fabina borrows principle= Rs12500

at rate= 12%

time=3years

S.I =p×r×t/100

S.I= 12500×12×3/100

S.I=Rs 4500

Amount =P+S.I.

Amount=12500+4500

Rs17000

Radha principle =Rs12500

Rate=10%

Time =3 years

Compounded annually

Amount =(1+r/100)³×P

Amount =(1+10/100)³×12500

Amount = Rs 16637.50

Interest =Amount-Principle

Interest =16637.50-12500

Interest =4137.50

therefore we can see that Fabina has to pay more interest as compared to Radha

INTEREST paid more by Fabina

=Rs 4500-4137.50

=Rs 362.50