Question

14 The simple interest on a certain sum of money for 2 years at 10% per annum is 1600
Find the amount due and the compound interest on this sum of money at the same
rate after 3 years, interest being reckoned annually.
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Answer 1

Step-by-step explanation:

It is given that

Period = 2 years

Rate = 10% p.a.

We know that

Sum = (SI×100)/(r×n)

Substituting the values

= (1600×100)/(10×2)

= 8000

Here

Amount after 3 years =P(1+r/100)

n

Substituting the values

=8000(1+10/100)

3

By further calculation

=8000×11/10×11/10×11/10

=10648

So the compound interest = A -P

Substituting the values

= 10648−8000

= 2648