Question

Reena needed 5000 for a period of six months. Atul
agreed to lend her this sum at 4% p.a. compounded
every three months. Find the amount Reena has to
pay Atul at the end of six months.​

Answer 1

Hey Dear,

◆ Answer -

Reena needs to pay 5105 Rs to Atul after 6 months.

◆ Explanation -

At the end of first three months, interest is calculated by -

Compound interest = principal × rate of interest × period

Compound interest = 5000 × 4/100 × 3/12

Compound interest = 50 Rs

So new principal after 3 months will be 5000+50 = 5500 Rs.

Now, new compound interest after next 3 months will be -

Compound interest = principal × rate of interest × period

Compound interest = 5500 × 4/100 × 3/12

Compound interest = 55 Rs

So now total amount Reena needs to pay Atul is 5000 + 50 + 55 = 5105 Rs.

Thanks dear...