A man borrows rs.6000 at 5% compound interest p.a. If he repays rs.1200 at the end of each year, find the amount of loan outstanding at the beginning of each year.

A man borrows rs.6000 at 5% compound interest p.a. If he repays rs.120

1.	A man borrows rs.6000 at 5% compound interest p.a. If he repays rs.1200 at the end of each year, find the amount of loan outstanding at the beginning of each year.
Answer» Given Principle amount = Rs . 6000Rate of interest = r = 5% compounded annuallyInterest after 1 year = 6000 × 5 × 1100 = 60× 5 = Rs . 300Total money owed after 1 year = 6000 + 300 = 6300Rs. 1200 paid , SoTotal money starting of second year = 6300 - 1200 = Rs.5100Interest after 2 year = 5100 × 5 × 1100 = 51× 5 = Rs . 255money owned after 2 year = 5100 + 255 = 5355AndRs. 1200 paid , Total money outstanding starting of Third year = 5355 - 1200 = Rs.4155