Anand obtained a loan of Rs. 125000 from the Allahabad Bank for buying computers. The bank charges compound interest at 8% per annum, compounded annually. What amount pwill he have to pay after 3 years to clear the debt?

Present value = Rs.125000

Interest rate = 8% per annum

Time = 3 years

Amount (A) = P (1 + R/100)n [Where, P = Present value

R = Annual interest rate

n = Time in years]

A = 125000 (1 + 8/100)3

A = 125000 (108/100)3

A = 125000 × 108/100 × 108/100 × 108/100

A = 125000 × 1259712/1000000

A = 125 × 1259712/1000

A = 1259712/8

A = 157464

Amount = Rs.157464

Anand has to pay Rs.157464 after 3 years to clear the debt.

Rate this question :

How useful is this solution?
We strive to provide quality solutions. Please rate us to serve you better.
Related Videos
Compound Interest39 mins
Concept of Compound Interest50 mins
Application of Compound Interest38 mins
Quiz | Simple & Compound Interest35 mins
RD Sharma | Compound Interest38 mins
Quiz | Calculating Compound Interest Really Compound?46 mins
Taxes, Discount and Compound Interest34 mins
Goprep Genius Quiz | Taxes, Discount and Compound Interest25 mins
Become Proficient in Simple Interest36 mins
One Step Ahead of Simple Interest44 mins
Try our Mini CourseMaster Important Topics in 7 DaysLearn from IITians, NITians, Doctors & Academic Experts
Dedicated counsellor for each student
24X7 Doubt Resolution
Daily Report Card
Detailed Performance Evaluation
view all courses