Question

Rahim, an unemployed youth , received Rs. 4000 as loan from State Bank of India at a nominal rate of 5/2% per annum . Find out the compound interest that Rahim pays after 2 years.

Answer 1

The compound interest that Rahim pays after 2 years is Rs. 202.5.

Step-by-step explanation:

Since we have given that

Loan amount = Rs. 4000

Rate of interest = $\dfrac{5}{2}\%$

Time = 2 years

So, Amount would be

$A=4000(1+\dfrac{5}{200})^2\\\\A=4000(\dfrac{200+5}{200})^2\\\\A=4000(\dfrac{205}{200})^2\\\\A=Rs.\ 4202.5$

So, Amount = Principal + Compound interest

Compound interest is given by

$4202.5-4000=Rs.\ 202.5$

Hence, the compound interest that Rahim pays after 2 years is Rs. 202.5.

# learn more:

Rahul obtained a loan of ₹4000 for the purchase of a bike from a bank. If the rate of interest is 15 %per annum then find the compound interest that he will have to pay after 2 years .​

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