A loan of Rs. 50,000 carries annual interest of 10% and requires an annual payment of Rs. 20,000. What is the outstanding balance immediately after the first payment?
Correct answer: B. Rs. 35,000
- A. Rs. 30,000
- B. Rs. 35,000
- C. Rs. 36,000
- D. Rs. 40,000
Explanation
Interest for the first year is Rs. 5,000, so the balance before payment is Rs. 55,000. After paying Rs. 20,000, the outstanding balance is Rs. 35,000. Subtracting the full payment from the original principal ignores the first year's interest.
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