A boutique owner in Enugu borrowed to expand her business at an annual interest rate of , compounded annually. If she repays the loan in full after years, what is the total interest she paid on the loan?
- A
- Cevap
- C
- D
Cevap
The total interest paid on the loan after 2 years is .
The compound interest is calculated year by year. In the first year, the interest paid is of , raising the balance to . In the second year, the interest paid is of . Adding the two yearly interest payments gives .
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Anahtar Kavram
Compound Interest Calculation
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