Vimal bro rupees 28500 from a private bank to purchase a motorcycle at the rate of 12% per annum compounded annually what amount will he pay at the end of 3 years 4 months to clear his loan amount
Answers
Answer:
Simple Interest:
If the principal remains the same throughout the loan period then the interest calculated on this principle is called the simple interest.
Principal (P): The original sum of money loaned/deposited. Also known as capital.
Time (T): The duration for which the money is borrowed/deposited.
Rate of Interest (R): The percent of interest that you pay for money borrowed, or earn for money deposited
Simple interest is calculated as
S.I= (P×R×T)/100
Total amount at the end of time period
A= P + SI
compound interest:
The time Period after which interest is added each time to form a new principal is called the conversion period and the interest so obtained is called a compound interest.
If the conversion period is 1 year then the interest is said to be compounded annually.
The main difference between the simple interest and compound interest on a certain sum is that in the case of simple interest the principal remains constant throughout wheras in the case of compound interest it goes on changing periodically.
The above formula is the interest compounded annually
A= P(1+r/100)^n
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Solution:
Given:
Principal (P) = ₹ 26,400, Time (n)= 2 years 4 months, Rate of interest (R) = 15% p.a.
Amount for 2 years (A) = P(1+R/100)^n
=26400(1+15/100)²
= 26400(1+3/20)²
= 26400(23/20)²
= 26400(23/20)×(23/20
= (264×23×23)/4= 66×23×23
= ₹34,914
Interest for 4 months= 4/12=1/3
Interest for 1/3 years at the rate of 15% = (34914×15×1)/3×100
= (34914×5)/100
= ₹ 174570/100
= ₹ 1745.70
Total amount = ₹ 34,914 + ₹ 1,745.70
= ₹ 36,659.70
The amount she will pay at the end of 2 years and 4 months to clear the loan= ₹ 36,659.70
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Hope this will help you.....