Question

U Jull of 28,000 after 2 years?9. Shyam borrowed some money from Arpan at 12% per annum. He had to pay8. A farmer borrowed 18,000 from a moneylender at a simple interest of 15% per annum. At the end of 3 years6 months, he settled the loan after paying 15,000 cash and a motorbike. Find the value of the motorbike.

a) $7,000
b) $8,000
c) $9,000
d) $10,000

Answer 1

To determine the value of the motorbike, we calculate the total owed after 3.5 years of simple interest and subtract the $15,000 cash payment. The interest comes to $9,450, making the total owed $27,450. Subtracting the cash payment, the motorbike's value is $12,450, which does not match any of the provided options.

Step-by-step explanation:

The value of the motorbike can be determined by first calculating the total amount the farmer would owe after 3.5 years (3 years and 6 months) at a simple interest rate of 15% per annum on a principal amount of $18,000.

To find the interest (I), we use the formula:

I = P × R × T

Where:

• P is the principal amount ($18,000)
• R is the annual interest rate (15%, or 0.15 as a decimal)
• T is the time in years (3.5 years)

So,

I = $18,000 × 0.15 × 3.5 = $9,450

The total amount owed after 3.5 years is the sum of the principal and the interest:

Total Owed = Principal + Interest

Total Owed = $18,000 + $9,450 = $27,450

Given that the farmer paid $15,000 in cash towards this amount, we subtract this from the total owed to find the value of the motorbike:

Value of Motorbike = Total Owed - Cash Paid

Value of Motorbike = $27,450 - $15,000 = $12,450

However, this value does not match any of the options provided (a) $7,000 (b) $8,000 (c) $9,000 (d) $10,000, which indicates there may be an error in the initial question or the provided options.