XAT 2012 — QA & DI Question 8
InstallmentsEasy
Passage / Data
Answer the following question based on the information given below.
The following graphs shows the revenue (in $ million) of three companies in their initial six years of operations, in an economy which is characterized by a persistent inflation.
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A man borrows Rs. 6000 at 5% interest, on reducing balance, at the start of the year. If he repays Rs. 1200 at the end of each year, find the amount of loan outstanding, in Rs., at the beginning of the third year.
Answer & solution
Correct answer: 4155.00
- A
3162.75
- B
4125.00
4155.00
- D
5100.00
- E
5355.00
Solution
After one year, amount due = 6000 × 1.05 – 1200 = 5100
Hence, amount due after two years = 5100 × 1.05 – 1200 = 4155
Hence, option (c).