Question

Varun borrowed rupees 25000 from a bank where compound interest in computed at 11% annually. He repaid Rs 10000 at the end of 2 years. How much amount he has to repay after one more year?

Answer 1

Amount borrowed = 25000

Rate of interest = 11%

Total liability after 2 year

Amount he repaired = Rs.10000

Principal for the third year

= 30802.50 – 10000

= Rs.20802.50

Amount he has to repay at the end of third year

= 20802.50 × (1 + \(\frac{11}{100}\))

= 20802.50 × \(\frac{111}{100}\)

= Rs. 23090.78