Question
A borrows Rs 5000 from B at 8% p.a compound interest
compounded annually. At the end of every year he pays Rs 2000 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?Solution
At the end of the 1st year: Amount = 5000 × 108% = Rs. 5400 Rest amount = 5400 – 2000 = Rs. 3400 At the end of 2nd year: Amount = 3400 × 108% = Rs. 3672 Rest amount = 3672 – 2000 = Rs. 1672 At the end of 3rd year: Amount = 1672 × 108% = Rs. 1805.76
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