I would choose option 1. R 31 31 100 0031. The business will pay back a total of 16000.
So in case of monthly compounding it would be 12.
A 2000 1 003 1 2060. Example 6 interest with monthly compounding does not mean 6 per month it means 05 per month 6 divided by 12 months and is worked out like this. N the number of compounding periods in a year or 12. Examples of Compound Interest.