Question

A sum of Rs 12,500 is invested at 6% p.a compounded annually for 2.5 years. Find the amount
at the end of 2.5 years.

Answer 1

★ Given :

• Sum of money ₹12,500 is invested at 6% p. a. (per annum) for 2.5 years compounded anually.

★ To find :

The amount after 2.5 years.

★ Solution :

Here, we'll calculate the amount for first 2 years and then for the next ½ years at simple inetrest.

[Since, 2.5 years = 2½ years]

Using amount formula :

→ Amount = p(1 + r/100)ⁿ

Where,

• p(principal) = 12,500
• r(rate) = 6% p. a.
• n(time) = 2 years.

So, the amount is

→ 12,500(1 + 6/100)²

→ 12,500(1 + 3/50)²

→ 12,500(53/50)²

→ 12,500 × 2809/2500

→ 5 × 2809

→ 14,405

Amount is 14,405

So, C. I. = 14,405 - 12,500 = ₹1905

Now,

Simple interest = prt/100

Where,

• p(principal) = ₹14,405
• r(rate) = 6%
• t(time) = ½ years.

So,

→ 14,405 × 6 × ½/100

→ 14,405 × 6/200

→ 432.15

Therefore,

the amount after 2.5 years is : ₹1905 + ₹432.15

= 2,337.15

Required answer : ₹2,337.15