Question

Sameerrao has taken a loan of Rs 12500 at the rate of 12 p.c.p.a. for 3 years. If the interest is compounded annually then how many rupees should he pay to clear his loan?

Answer 1

Here, P = Rs 12,500, R = 12 p.c.p.a. and N = 3 years

= 0.8 × 28 × 28 × 28 

= Rs 17,561.60 

Sameerrao should pay Rs 17,561.60 to clear his loan.