Naman borrows a sum of ₹3,48,020 at the rate of 8% per annum simple interest. At the end of the first year, he repays ₹15,090 towards return of principal amount borrowed. If Naman clears all pending dues at the end of the second year, including interest payment that accrued during the first year, how much does he pay (in ₹) at the end of the second year?
Show answer & explanation
Correct answer: B
Explanation
The correct answer is Option 2 i.e. 3,87,406.
Naman borrows a sum of ₹3,48,020 at the rate of 8% per annum simple interest
We know that,
S.I. = (P × R × T)/100
here, S.I. = Simple interest, R = Rate, P = Principal, T = Time
⇒ S.I. = (348020 × 8 × 1)/100
⇒ S.I. = (348020 × 8)/100
⇒ S.I. = (348020 × 8)/100
⇒ S.I. = 27841.6
At the end of the first year, he repays ₹15,090 towards return of principal amount borrowed
Remaining amount = ₹348020 - ₹15090 = ₹332930
Now,
⇒ S.I. = (332930 × 8 × 1)/100
⇒ S.I. = ₹26634.4
Now, total interest = 27841.6 + 26634.4 = ₹54476
Total amount = 332930 + 54476 = ₹387406
Thus, the amount he pay at the end of the second year is ₹387406