The total loan amount is 800,000 shillings. Since there are four equal yearly installments of 200,000 shillings, Tom will pay back 200,000 shillings per year.
Now, let's calculate the compound interest and ledger fees for each installment:
- For the first installment, Tom will owe 800,000 shillings (loan amount) + 800,000 shillings * 16% (compound interest) + 800,000 shillings * 15% (ledger fee) = 800,000 + 128,000 + 120,000 = 1,048,000 shillings.
- For the second installment, Tom will owe the previous balance of 1,048,000 shillings + 1,048,000 shillings * 16% (compound interest) + 1,048,000 shillings * 15% (ledger fee) = 1,048,000 + 167,680 + 157,200 = 1,372,880 shillings.
- For the third installment, Tom will owe the previous balance of 1,372,880 shillings + 1,372,880 shillings * 16% (compound interest) + 1,372,880 shillings * 15% (ledger fee) = 1,372,880 + 219,660.8 + 205,932 = 1,798,472.8 shillings.
- For the fourth and final installment, Tom will owe the previous balance of 1,798,472.8 shillings + 1,798,472.8 shillings * 16% (compound interest) + 1,798,472.8 shillings * 15% (ledger fee) = 1,798,472.8 + 287,755.65 + 269,770.92 = 2,356,999.37 shillings.
Therefore, the total amount of money paid by Tom to clear the loan is 200,000 shillings (first installment) + 1,048,000 shillings + 1,372,880 shillings + 1,798,472.8 shillings + 2,356,999.37 shillings = 6,575,352.17 shillings.
Tom bought a car wash in is 800,000 using a loan from credit corporation he was to pay back using four equal yearly installment of shillings 200,000 the render charged compound interest at a rate of 16% and a ledger fee at 15% per annum on the any outstanding balance at the time when each installment is paid what is the total amount of money paid at Tom to clear the loan
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