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# Ramesh borrowed Rs 15625 from suresh to buy a scooter. If the rate of interest is 16%...

eNoter

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Ramesh borrowed Rs 15625 from suresh to buy a scooter. If the rate of interest is 16% p.a. compounded annually,how much will he have to pay after 9/4 yrs.

this question is from simple interest and compound interest.

here, p.a. - per annum

Posted by user3496714 on January 26, 2013 at 7:11 AM via web and tagged with math, maths

High School Teacher

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To solve, use the formula of compounding interest which is:

`A = P(1+ r/n)^(nt)`

where P - principal/initial amount, r - annual rate on interest, number of times compounded per year, t - number of years the amount is borrowed for, and A - amount of money accumulated after t years.

Substitute the given values P=Rs15625 , r = 16%=0.16 and t=9/4 years. Since r is compounded annually, n=1.

`A=15625(1+0.16/1)^(1*9/4)`

`A=15625(1.016)^(9/4)`

`A=16193.13`

Posted by mjripalda on January 26, 2013 at 10:25 AM (Answer #2)

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