Question

. Sam took a loan of ₹5000 compounded annually for 2 ½ years at 10% per annum. What amount will
he pay to clear the debt?

Answer 1

Answer:

₹ 6352.5

Step-by-step explanation:

Answer 2

The amount Sam will have to pay to clear the debt of Rs. 5000 compounded annually for 2½ years at 10% p.a. is Rs. 6352.5.

Step-by-step explanation:

Required Formula:

• Amount, A = P[1 + $\frac{R}{100}$]ⁿ

The loan amount taken by Sam, P = Rs. 5000

Time period, n = 2½  years

The rate of interest, R = 10% p.a.

Since the interest is given to be compounded annually, therefore,  by substituting the given values in the above formula, we get

A = 5000 * [1+$\frac{10}{100}$]² * [1+ $\frac{\frac{10}{2}}{100}$]

⇒ A = 5000 * [$\frac{11}{10}$]² * [1+ $\frac{5}{100}$]

⇒ A = 5000 * $\frac{11}{10}$ * $\frac{11}{10}$ * $\frac{21}{20}$

⇒ A = 5 * 11 * 11 * 21

⇒ A = Rs. 6352.5

Thus, Sam will have to pay an amount of Rs. 6352.5 to clear the debt.

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