Ram Singh busy a refrigerator for Rs 4000 on credit. The rate of interest for the first year is 5% and of the second year is 15%. How much will it cost him if he pays the amount after two years?

Explanation

For first year
SI `=( P xx R xx T)/100`
SI`= (4000 xx 5 xx 1)/100 =200`
Amount `=4000+200=4200`

For second year
SI `= (4200 xx 15 xx 2)/100 =1260`

Amount `= 4200+1260=5460`