Answer:
Given:
Total amount repaid (A) = R85,000
Time (t) = 2 years
Interest rate (r) = 9% or 0.09
Number of times compounded (n) = 1 (since compound interest is charged annually)
We need to solve for P:
85,000 = P(1 + 0.09/1)^(1*2)
Now, let's solve for P:
85,000 = P(1 + 0.09)^2
85,000 = P(1.09)^2
85,000 = P(1.1881)
Now divide both sides by 1.1881:
P = 85,000 / 1.1881
P ≈ R71,530.49
So, the amount borrowed was approximately R71,530.49.
