Pranav borrows a sum of ₹7,54,079 at the rate of 15% per annum simple interest. At the end of the first year, he repays ₹16,118 towards return of principal amount borrowed. If Pranav clears all pending dues at the end of the second year, including interest payment that accrued during the first year, how much does he pay at the end of the second year?

1. A

   ₹9,64,494

2. B

   ₹9,61,767

3. C

   ₹9,64,573

4. D

   ₹9,60,487

Appeared in: Bihar NHM CHO-2025

Explanation

• The calculation correctly determines the interest for the first year on the initial principal (₹7,54,079 * 15% = ₹1,13,111.85).
• It then correctly reduces the principal by the repaid amount for the second year's calculation (₹7,54,079 - ₹16,118 = ₹7,37,961).
• The interest for the second year is calculated on this new, lower principal (₹7,37,961 * 15% = ₹1,10,694.15).
• The final payment is the sum of the remaining principal and the interest from both years (₹7,37,961 + ₹1,13,111.85 + ₹1,10,694.15 = ₹9,61,767).

Why Other Options Were Wrong

• Option A: This value likely results from a calculation error, possibly by incorrectly calculating the interest for the second year or summing the components incorrectly.
• Option C: This value is incorrect. A common mistake is to calculate the interest for both years on the original principal without reducing it after the repayment. This would lead to a higher, incorrect total.
• Option D: This value is incorrect and likely stems from an arithmetic mistake during one of the calculation steps, such as subtraction or addition.

Related Visual

• Visual 1: Flowchart: A flowchart illustrating the calculation process: Start with Initial Principal -> Calculate Year 1 Interest -> Subtract Principal Repayment to get New Principal -> Calculate Year 2 Interest -> Sum Remaining Principal + Year 1 Interest + Year 2 Interest to get Final Payment.

Clinical Relevance

• Nursing practice connection: This is primarily an exam-oriented knowledge point with limited direct bedside application, so retain Simple Interest Calculation with Partial Principal Repayment as background academic context rather than a clinical decision trigger.
• This question tests numerical aptitude and attention to detail, which are essential skills for nurses in various tasks such as medication dosage calculation, fluid balance monitoring, and interpreting lab results.
• While not a direct clinical scenario, the ability to perform multi-step calculations accurately is a foundational skill for ensuring patient safety in a clinical setting.
• What if the repayment of ₹16,118 was an interest-only payment? In that case, the principal for the second year would remain ₹7,54,079, and the interest for both years would be the same, leading to a different final amount.

How to Approach the Question

• First, identify all the given values: initial principal, interest rate, and the principal repayment amount.
• Calculate the simple interest for the first year using the initial principal.
• Subtract the principal repayment from the initial principal to find the new principal for the second year.
• Calculate the simple interest for the second year using the new, reduced principal.
• Finally, sum the remaining principal, the first year's interest, and the second year's interest to find the total amount due.

Concept Tested & Keywords

• Concept Tested: Simple Interest Calculation with Partial Principal Repayment
• Stem keywords: simple interest, borrows, repays, principal amount, rate of 15% per annum
• Lead-in keywords: how much does he pay

Question ID

Q5dd_vVVLgTCxBQ459esJI

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