1.) Suppose P55,000 was borrowed from ABC Lending Company at 5% interest per year for 2 years. Find the amount after two years.

Question

asked Oct 18, 2022 227k views

1 Answer

Rorra · Answer 1 · 2022-10-23T06:44:30+0000

Given:

Principal value of loan = 55,000

Rate of interest = 5%

Time = 2 year

To find:

The amount after two years.

Solution:

The formula for amount is

$A=P\left(1+(r)/(100)\right)^t$

Where, P is principal, r is rate of interest in %, t is time in years.

Putting P=55,000, r=5 and t=2, we get

$A=55000\left(1+(5)/(100)\right)^2$

$A=55000\left(1+0.05\right)^2$

$A=55000\left(1.05\right)^2$

A=55000(1.1025)

A=60637.50

Therefore, the amount after two years is P60637.50.