A person takes a loan of ₹25,000 for 2 years at a rate of interest of 5%. What will be the total amount to be paid after 2 years?
Show answer & explanation
Correct answer: A
Explanation
Given:
Principal = ₹25,000
Interest rate = 5%
Time = 2 years
Formula:
SI = (P × R × T) / 100
A = P + SI
SI = (25,000 × 5 × 2) / 100 = 2500
A = 25,000 + 2500 = 27,500
Total amount = ₹27,500