Question

Gautam takes a loan of $16000 for 2 years at 15%p.a. compound interest .He repays $9000 at the end of first year.How much must he pay at the end of second year to clear to the debt

Answer 1

compound interest after one year= 16000*15/100

= 2400.

now at the end of first year total amount become 18400. after one year he repay 9000 this implies now the amount become 9400

therefore total amount afternoon second year=9400+9400*15/100

= 9400+1410

=10810.

therefore to clear his debt he have to give 10810