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A loan of ₹13,500 is to be paid back in two equal annual instalments. If the rate of interest is 16% p.a. compounded annually, then what is…

3219Medium DSSSB TGT Computer Science 0 replies

A loan of ₹13,500 is to be paid back in two equal annual instalments. If the rate of interest is 16% p.a. compounded annually, then what is the total interest paid in this instalment scheme?

A₹3,300
B₹3,320
C₹3,360
D₹3,350

Correct answer: B

Explanation

Let each instalment be P. P/1.16 + P/1.16² = 13500, so P = 13500 × 1.3456/2.16 = ₹8,410. Total paid = 2 × 8410 = ₹16,820. Interest = 16820 − 13500 = ₹3,320.

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