Calculate the Compound Interest for second year on Rs.5000 invested for 3 years at 10% p.a.
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Compound interest for the second year will be the simple interest gained in the second year, with the amount after first year being the principal for the second year.
For the first year
P=Rs8,000
N=1year
R=10 %
We have S.I.=100PNR=1008,000×1×10=Rs800
And Amount at the end of first year P+S.I.=Rs8,000+Rs800=Rs8,800
Now, for the second year
P=Rs8,800
N=1year
R=10 %
We have S.I.=100PNR=1008,800×1×10=Rs880
Thus, Compound interest for the second year =Rs880
Step-by-step explanation:
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