A borrows a sum of 2000 from his friend B on 31 December 2011 on the condition that he will return the same after one year with simple interest at 8% per annum. However, A get into a position of returning the money on 1 July 2012. How much amount he has to return to B?Options2,0802,2002,0882,070
Question
A borrows a sum of 2000 from his friend B on 31 December 2011 on the condition that he will return the same after one year with simple interest at 8% per annum. However, A get into a position of returning the money on 1 July 2012. How much amount he has to return to B?Options2,0802,2002,0882,070
Solution
To calculate the amount that A has to return to B, we need to consider the principal amount borrowed, the interest rate, and the time period.
Given: Principal amount (P) = $2000 Interest rate (R) = 8% per annum Time period (T) = 1 year
First, we need to calculate the simple interest (SI) using the formula: SI = (P * R * T) / 100
SI = (2000 * 8 * 1) / 100 SI = 160
The simple interest accrued is $160.
Now, we need to calculate the total amount to be returned by adding the principal amount and the interest accrued: Total amount = Principal amount + Simple interest Total amount = 2000 + 160 Total amount = 2160
Therefore, A has to return $2160 to B.
Among the given options, the correct answer is 2,160.
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