Wepukhulu borrowed sh.180000 from a bank that charge compound interest at a rate of 10% p.a calculate the amount he paid back after 3 years
Mathematics
ScanSolve AI Answer
Answer
The amount Wepukhulu paid back after 3 years is Sh. 239,580.
Step-by-step solution
3 stepsHere's how to calculate it:
Formula for Compound Interest:
A = P * (1 + r)^n
Where:
- A = Amount after n years
- P = Principal amount (initial loan)
- r = Annual interest rate (as a decimal)
- n = Number of years
Given values:
- P = Sh. 180,000
- r = 10% = 0.10
- n = 3 years
Calculation:
Year 1
A = 180,000 * (1 + 0.10)^1
A = 180,000 * 1.10
A = Sh. 198,000Year 2
A = 198,000 * (1 + 0.10)^1
A = 198,000 * 1.10
A = Sh. 217,800Year 3
A = 217,800 * (1 + 0.10)^1
A = 217,800 * 1.10
A = Sh. 239,580Alternatively, using the direct formula:
A = 180,000 * (1 + 0.10)^3
A = 180,000 * (1.10)^3
A = 180,000 * 1.331
A = Sh. 239,580
Was this helpful?
Still stuck on this one?
Ask a follow-up, and the answer starts from this question.
Got a different question?Ask your own question
More Mathematics Questions
QA businessman borrowed Sh. 120,000 from a bank the bank charged Simple interest at the rate of 16%…QA man borrowed a sum of money at a simple interest rate of 20% per annum. After 1 year, he paid a…QA farmer borrowed ksh 15000 from a SACCO and repaid a total of Ksh 18,450 after 2 years. Calculate…QA businessman obtained a loan of Ksh 450,000 from a bank to buy a piece of land. The bank charges…QA borrower received TZS 10,000,000 from a bank at a simple interest rate of 8% per year for 2 years…