PRC-2 · Chapter 5 · Question 16 of 50
A local trader borrows Rs. 40,000 at a simple interest rate of 8% per annum. What is the total amount (principal plus interest) he must repay at the end of exactly 4 years?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Rs. 52,800
Explanation
First, calculate simple interest using I = PRT: 40,000 * 0.08 * 4 = 12,800. The total repayment amount is the Principal plus Interest: 40,000 + 12,800 = Rs. 52,800.
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