Unit-14 Commercial Mathematics

In this unit you will learn about profit and loss, various taxes, shares and debentures.

If you borrow Rs.5000 at 4% rate of simple interest quarterly, how much must you
repay at the end of 15 months?

Answer

P = Rs.5000

r = 4% = 0.04 quarterly = 0.04 × 4 annually = 0.16 annually

t = 15 months = 15/12 years = 1.25 years

Interest = 5000 ×0.16 × 1.25 = Rs. 1000

The amount you repay at the end of 15 months = Rs. (5000 + 1000) = Rs.6000.