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Mr. Sharma Borrowed a Certain Sum of Money at 10% per Annum Compounded Annually. If by Paying Rs.19,360 at the End of the Second Year And Rs. 31,944 at the End of the Third Year He Clears the Debt; - Mathematics

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Question

Mr. Sharma borrowed a certain sum of money at 10% per annum compounded annually. If by paying Rs.19,360 at the end of the second year and Rs. 31,944 at the end of the third year he clears the debt; find the sum borrowed by him.

Sum
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Solution

At the end of the two years the amount is

`"A"_1 = "P"( 1 + r/100 )^n`

⇒ `"A"_1 = "P"( 1 + 10/100 )^2`

Mr. Sharma paid Rs. 19,360 at the end of the second year.

So for the third year the principal is A1 - 19,360.

Also, he cleared the debt by paying Rs. 31,944 at the end of the third year.

`"A"_2 = "P"( 1 + r/100 )^n`

⇒  31,944 = `("P"( 1 + 10/100 )^2 - 19,360)( 1 + 10/100)^1`

⇒  29040 = `("P"( 1 + 10/100 )^2 - 19,360)`

⇒  `"P"( 1 + 10/100 )^2 = 48,400`

⇒  P = Rs. 40,000

Mr. Sharma borrowed Rs. 40,000.

shaalaa.com
Concept of Compound Interest - When the Time is Not an Exact Number of Years and the Interest is Compounded Yearly
  Is there an error in this question or solution?
Chapter 3: Compound Interest (Using Formula) - Exercise 3 (D) [Page 54]

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Selina Concise Mathematics [English] Class 9 ICSE
Chapter 3 Compound Interest (Using Formula)
Exercise 3 (D) | Q 8 | Page 54

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