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Raman took a loan of ₹15,000 from Laxman. It was agreed that for the first three years the rate of interest charged would be 8% simple interest per annum and from the fourth year onwards 10% compound interest, compounded annually. Raman did not pay anything until the end of the fifth year. How much would he repay if he clears the entire amount at the end of the fifth year?

1. ₹22506
2. ₹22105
3. ₹22900
4. ₹22500

Correct answer: ₹22506

Solution

For the first 3 years, simple interest on ₹15,000 at 8% is ₹3,600, so the amount becomes ₹18,600. This amount is then compounded at 10% for 2 years: ₹18,600 × 1.1 × 1.1 = ₹22,506.

Related IBPS PO General Awareness questions

• What would be the compound interest obtained on an amount of ₹3,000 at the rate of 8% per annum after 2 years?
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• Anurag invested ₹15,000 in Scheme A at simple interest for two years at 15% per annum. If he again invests the total amount received from Scheme A in Scheme B at compound interest at 20% per annum for two years, then find the interest obtained in Scheme B.
• Mohan invested a sum at the rate of 15% simple interest per annum for two years and received a total amount of ₹9984. He invested the same amount at the rate of \(x\)% per annum at compound interest for two years and received ₹6500 more interest than the simple interest. Find the value of \(x\) approximately.
• A sum becomes eight times in 3 years compounded annually. In how much time will it become sixteen times at the same rate?

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