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John borrowed Rs. 2,10,000 from a bank at an interest rate of 10% per annum, compounded annually. The loan was repaid in two equal instalments, the first after one year and the second after another year. The first instalment was interest of one year plus part of the principal amount, while the second was the rest of the principal amount plus due interest thereon. Then each instalment, in Rs., is
Correct answer is '121000'. Can you explain this answer?
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John borrowed Rs. 2,10,000 from a bank at an interest rate of 10% per ...
We have to equate the installments and the amount due either at the time of borrowing or at the time when the entire loan is repaid. Let us bring all values to the time frame in which all the dues get settled, i.e, by the end of 2 years.
John borrowed Rs. 2,10,000 from the bank at 10% per annum. This loan will amount to 2,10,000*1.1*1.1 = Rs.2,54,100 by the end of 2 years.
Let the amount paid as installment every year be Rs.x.
John would pay the first installment by the end of the first year. Therefore, we have to calculate the interest on this amount from the end of the first year to the end of the second year. The loan will get settled the moment the second installment is paid.
=> 1.1x + x = 2,54,100
2.1x = 2,54,100
=> x = Rs. 1,21,000.
Therefore, 121000 is the correct answer.
John borrowed Rs. 2,10,000 from the bank at 10% per annum. This loan will amount to 2,10,000*1.1*1.1 = Rs.2,54,100 by the end of 2 years.
Let the amount paid as installment every year be Rs.x.
John would pay the first installment by the end of the first year. Therefore, we have to calculate the interest on this amount from the end of the first year to the end of the second year. The loan will get settled the moment the second installment is paid.
=> 1.1x + x = 2,54,100
2.1x = 2,54,100
=> x = Rs. 1,21,000.
Therefore, 121000 is the correct answer.
Most Upvoted Answer
John borrowed Rs. 2,10,000 from a bank at an interest rate of 10% per ...
Given information:
John borrowed Rs. 2,10,000 from a bank at an interest rate of 10% per annum, compounded annually. The loan was repaid in two equal instalments, the first after one year and the second after another year.
To find:
The amount of each instalment.
Solution:
Let's calculate the amount of each instalment step by step.
Step 1: Calculating interest for the first year
Interest for the first year = Principal amount * Rate of interest
= Rs. 2,10,000 * 10/100
= Rs. 21,000
Step 2: Calculating principal amount repaid in the first instalment
Let the principal amount repaid in the first instalment be 'x'.
So, the remaining principal amount after the first instalment = Principal amount - x
= Rs. 2,10,000 - x
Step 3: Calculating interest for the second year
Interest for the second year = Remaining principal amount after the first instalment * Rate of interest
= (Rs. 2,10,000 - x) * 10/100
= (2,10,000 - x)/10
Step 4: Calculating the second instalment
The second instalment is the remaining principal amount after the first instalment plus the interest for the second year.
So, the second instalment = (Rs. 2,10,000 - x) + (2,10,000 - x)/10
= (10 * Rs. 2,10,000 - 10x + 2,10,000 - x)/10
= (21,00,000 - 11x)/10
Step 5: Calculating the total amount repaid
Total amount repaid = First instalment + Second instalment
= Rs. 21,000 + (21,00,000 - 11x)/10
According to the given information, both instalments are equal. So, the first instalment is equal to the second instalment.
Step 6: Equating the first and second instalments
Rs. 21,000 + (21,00,000 - 11x)/10 = (21,00,000 - 11x)/10
Rs. 21,000 = 21,00,000 - 11x
Solving the above equation, we get:
11x = 21,00,000 - Rs. 21,000
11x = Rs. 20,79,000
x = Rs. 1,89,000
Therefore, each instalment is Rs. 21,000 + Rs. 1,89,000 = Rs. 2,10,000.
Hence, the amount of each instalment is Rs. 2,10,000.
John borrowed Rs. 2,10,000 from a bank at an interest rate of 10% per annum, compounded annually. The loan was repaid in two equal instalments, the first after one year and the second after another year.
To find:
The amount of each instalment.
Solution:
Let's calculate the amount of each instalment step by step.
Step 1: Calculating interest for the first year
Interest for the first year = Principal amount * Rate of interest
= Rs. 2,10,000 * 10/100
= Rs. 21,000
Step 2: Calculating principal amount repaid in the first instalment
Let the principal amount repaid in the first instalment be 'x'.
So, the remaining principal amount after the first instalment = Principal amount - x
= Rs. 2,10,000 - x
Step 3: Calculating interest for the second year
Interest for the second year = Remaining principal amount after the first instalment * Rate of interest
= (Rs. 2,10,000 - x) * 10/100
= (2,10,000 - x)/10
Step 4: Calculating the second instalment
The second instalment is the remaining principal amount after the first instalment plus the interest for the second year.
So, the second instalment = (Rs. 2,10,000 - x) + (2,10,000 - x)/10
= (10 * Rs. 2,10,000 - 10x + 2,10,000 - x)/10
= (21,00,000 - 11x)/10
Step 5: Calculating the total amount repaid
Total amount repaid = First instalment + Second instalment
= Rs. 21,000 + (21,00,000 - 11x)/10
According to the given information, both instalments are equal. So, the first instalment is equal to the second instalment.
Step 6: Equating the first and second instalments
Rs. 21,000 + (21,00,000 - 11x)/10 = (21,00,000 - 11x)/10
Rs. 21,000 = 21,00,000 - 11x
Solving the above equation, we get:
11x = 21,00,000 - Rs. 21,000
11x = Rs. 20,79,000
x = Rs. 1,89,000
Therefore, each instalment is Rs. 21,000 + Rs. 1,89,000 = Rs. 2,10,000.
Hence, the amount of each instalment is Rs. 2,10,000.
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John borrowed Rs. 2,10,000 from a bank at an interest rate of 10% per annum, compounded annually. The loan was repaid in two equal instalments, the first after one year and the second after another year. The first instalment was interest of one year plus part of the principal amount, while the second was the rest of the principal amount plus due interest thereon. Then each instalment, in Rs., isCorrect answer is '121000'. Can you explain this answer?
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ample number of questions to practice John borrowed Rs. 2,10,000 from a bank at an interest rate of 10% per annum, compounded annually. The loan was repaid in two equal instalments, the first after one year and the second after another year. The first instalment was interest of one year plus part of the principal amount, while the second was the rest of the principal amount plus due interest thereon. Then each instalment, in Rs., isCorrect answer is '121000'. Can you explain this answer? tests, examples and also practice CAT tests.
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