Question

Sameerrao has taken a loan of `12500 at a rate of 12 p.c.p.a. for 3 years. If the interest is compounded annually then how many rupees should he pay to clear his loan?

Answer 1

If Sameerrao has taken a loan of `12500 at a rate of 12 p.c.p.a. for 3 years and the interest is compounded annually then should he pay to clear his loan can be calculated as shown below:

Amount = P{1 + (r/100)}^n

or, we know the values of P, r, n.

P = Rs 12500, r = 12% and n = 3yrs.

CI = 12500{1 + (12/100)^3

or, 12500{(112 x 112 x 112)/(1000000)}

or, Rs 17561.6 (Ans)

Therefore, Sameerrao has pay to pay Rs 17561.6 to clear his loan

Answer 2

Dear student:

Solution:

Formula for compound interest is,when calculated annually $= P (1+\frac{r}{100})^{n}$

here P = Principal amount = 12,500 Rs

r = rate in % = 12%

n= number of year = 3 Years

Amount $= 12500 (1+\frac{12}{100})^{3}$

Amount $= 12500 (\frac{100+12}{100})^{3}$

Amount $= 12500 (\frac{112}{100})^{3}$

Amount = $12500 (\frac{112}{100}) (\frac{112}{100}) (\frac{112}{100})\\ \\ \\ =\frac{17,561,600,000}{1,000,000} \\ \\ \\ =17,561.6 Rs$

So, The total amount sameera rao has returned : 17,561.60 Rupees ( including principal amount and interest)

Hope it helps you.