Multiple choice

Rohit took a loan of Rs. 30,000 from Rajesh. The condition of Rajesh set for Rohit was that for the first four years, the rate of interest would be at 10% simple interest per year and at 20% compound interest compounded annually from the fifth year onwards. Rohit payed foul and did not pay anything until the end of the sixth year. How much would he have to repay if he is to clear the entire amount only at the end of the sixth year?

  1. Rs. 60,480

  2. Rs. 50,500

  3. Rs. 42,800

  4. Rs. 42,000

  5. None of these
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A Correct answer
Explanation

First 4 years: SI = 30000 * 0.10 * 4 = 12000. Amount at end of 4 years = 42000. Next 2 years: CI at 20% = 42000 * (1.2)^2 = 42000 * 1.44 = 60480.

AI explanation

First, calculate the simple interest for the first 4 years using SI = (30000 * 10 * 4) / 100 = Rs. 12000. The total amount at the end of the 4th year becomes the principal for the next phase, which is 30000 + 12000 = Rs. 42000. This new principal is compounded at 20% for the remaining 2 years, calculated as A = 42000(1 + 0.20)^2 = 42000(1.44) = Rs. 60480. Rohit would have to repay Rs. 60,480.

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