Subbulakshmi took a loan of 18000 from Surya finance to purchase a TV set if the company charges compound interest at 12% per annum during the first year and 12th by half percent per annum during the second year how much will she have to pay after 2 years
Answers
Rs.18000after 3 years at 12%
compound interest=18000(1+12100)3
=18000(112100)3
Let x be the annual installment.
Total effective repayment
=xafter 2 years at 12% compound interest +x after 1 year at 12%
compound interest +x
=x(1+12100)2+
x
(
1
+
12
100
)
+
x
=
x
(
112
100
)
2
+
x
(
112
100
)
+
x
=
x
[
(
112
100
)
2
+
(
112
100
)
+
1
]
With the third installment of
Rs.
x
, the entire money is paid back.
⇒
18000
(
112
100
)
3
=
x
[
(
112
100
)
2
+
(
112
100
)
+
1
]
x
=
18000
(
112
100
)
3
(
112
100
)
2
+
(
112
100
)
+
1
=
18000
(
100
112
)
+
(
100
112
)
2
+
(
100
112
)
3
=
18000
×
112
3
112
2
×
100
+
112
×
100
2
+
100
3
≈
7494
Each installment is approximately
Rs.
7494
.
This situation can now be generalized. Assume a loan of Rs. L is taken at R% compound interest per annum and this is repaid in n equal yearly instalments. Then each instalment can be given by
L
(
100
100
+
R
)
+
(
100
100
+
R
)
2
+
⋯
+
(
100
100
+
R
)
n
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3 votes
Comments (3) Report
chiraag1112pokhriyal
Comment has been deleted
what is wrong with you to send the answer like that?
chiraag1112pokhriyal
Comment has been deleted
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