Select the correct answerA person takes a loan of Rs. 200 at 5% simple interest on the outstanding amount. He returns Rs. 100 at the end of one year. In order to clear his due at the end of 2 years, he would pay:

The calculation of simple interest is based on the original principal amount, the interest rate per period, and the number of periods.

Step 1: Calculate the interest for the first year. The formula for simple interest is I = PRT, where P is the principal amount, R is the rate of interest, and T is the time in years.

So, for the first year, the interest is I = 200 * 5/100 * 1 = Rs. 10.

Step 2: Calculate the outstanding amount at the end of the first year. The person returns Rs. 100 at the end of the first year. So, the outstanding amount is 200 (original principal) + 10 (interest) - 100 (amount returned) = Rs. 110.

Step 3: Calculate the interest for the second year. Now, the principal amount for the second year is Rs. 110. So, the interest for the second year is I = 110 * 5/100 * 1 = Rs. 5.5.

Step 4: Calculate the total amount to be paid at the end of the second year. The total amount to be paid is the outstanding amount at the end of the first year plus the interest for the second year. So, the total amount to be paid is 110 (outstanding amount) + 5.5 (interest) = Rs. 115.5.

So, in order to clear his due at the end of 2 years, he would pay Rs. 115.5.

The calculation of simple interest is based on the original principal amount, the interest rate per period, and the number of periods.

Step 1: Calculate the interest for the first year. The formula for simple interest is I = PRT, where I is the interest, P is the principal amount (initial loan amount), R is the rate of interest per period, and T is the time the money is borrowed for in number of periods.

For the first year, P = Rs. 200, R = 5/100 = 0.05 (since the rate is given in percentage, we divide by 100 to convert it to a decimal), and T = 1 year.

So, I = 200 * 0.05 * 1 = Rs. 10.

Step 2: Calculate the outstanding amount at the end of the first year. The person returns Rs. 100 at the end of the first year. So, the outstanding amount is the initial loan amount plus the interest for the first year, minus the amount returned.

Outstanding amount = P + I - amount returned = 200 + 10 - 100 = Rs. 110.

Step 3: Calculate the interest for the second year. For the second year, P = Rs. 110 (the outstanding amount), R = 0.05, and T = 1 year.

So, I = 110 * 0.05 * 1 = Rs. 5.5.

Step 4: Calculate the total amount to be paid at the end of the second year. The total amount to be paid is the outstanding amount at the end of the first year plus the interest for the second year.

Total amount to be paid = Outstanding amount + I = 110 + 5.5 = Rs. 115.5.

So, in order to clear his due at the end of 2 years, he would pay Rs. 115.5.