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+1 vote
5.1k views
in Compound Interest by (44.3k points)

Shubhalaxmi 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 12 ½ 5 per annum during the second year, how much will she have to pay after 2 years?

1 Answer

+1 vote
by (58.8k points)
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Best answer

Given:

Present value= ₹ 18000

Interest rate for first year, p= 12 % per annum

Interest rate for second year, q= 12 ½ % per annum

Amount (A) = P × (1+p/100) × (1+q/100)

Now substituting the values in above formula we get,

∴ A = 18000 × (1+12/100) × (1 + (25/2)/100)

⇒ A = 8000 × (112/100) × (1+25/200)

⇒ A = 8000 × (112/100) × (1+1/8)

⇒ A = 180 × 14 × 8

⇒ A = ₹ 22680

Shubhalaxmi has to pay ₹ 22680

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