Daljit received a sum of Rs. 40000 as a loan from a finance company. If the rate of interest is 7% per annum compounded annually, calculate the compound interest that Daljit pays after 2 years.

Given,


Principal = Rs.40000


Rate of interest = 7 %


Time = 2 years


Hence,


Compound interest =


=


So,


Compound interest paid by Daljit = Rs.5796


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