Question

David borrowed %5000 from a bank at a rate of 7% per annum compounded annually.

a) what will be the amount paid by David at the end of the 4 years?
b) Find the compound interest.

Answer 1

Answer:

a) Amount= 5000(1+7/100)^4

=5000(107/100)^4

5000×107×107×107×107/100×100×100×100

5x131079601/10×100×100

5×13107.9602

65504.98010

Step-by-step explanation:

compound interest= A-p

=65504.98010-5000

60504.98010 Ans

Answer 2

The amount after 4 years is 6553.98/-. Also, compound interest = 1553.98/-.

• The interest on a loan or principal amount can be easily calculated using simple interest. Simple interest is a notion that is employed across a wide range of industries, including banking, finance, automobiles, and more. When you pay back a loan, the monthly interest is deducted first, and any remaining funds are applied to the principal.
• Compound interest is calculated by multiplying the initial principal amount by one plus the annual interest rate multiplied by the number of compound periods multiplied by one. The total initial loan amount is then deducted from the resulting value.

Here, according to the given information, we are given that,

The Principal (P) = Rs. 5000,

The time period (t) = 4 years,

Rate of interest (r) = 7% per annum.​

Now, Amount is given as, $P(1+\frac{r}{100}) ^{t}$

Now, we get,

Amount =

$5000(1+\frac{7}{100}) ^{4}\\=6553.98$

Then, the amount after 4 years is 6553.98/-

Then, compound interest = Amount - Principal = 6553.98 - 5000 = 1553.98/-

Hence, the amount after 4 years is 6553.98/-. Also, compound interest = 1553.98/-.

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