Question

    A borrows Rs 4000 from B at 20% p.a

    compound interest compounded annually. At the end of every year he pays Rs 1500 and at the end of 3rd years he pays all the amount, how much amount does he pay at the end of the 3rd year?
    A Rs. 4513.75 Correct Answer Incorrect Answer
    B Rs. 3076.8 Correct Answer Incorrect Answer
    C Rs. 5960 Correct Answer Incorrect Answer
    D Rs. 2952 Correct Answer Incorrect Answer
    E Rs. 8458.25 Correct Answer Incorrect Answer

    Solution

    At the end of the 1st year:
    Amount = 4000 × 120% = Rs. 4800
    Rest amount = 4800 – 1500 = Rs. 3300
    At the end of 2nd year:
    Amount = 3300 × 120% = Rs. 3960
    Rest amount = 3960 – 1500 = Rs. 2460
    At the end of 3rd year:
    Amount = 2460 × 120% = Rs. 2952

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