Question

Example of compound interest in ₹​

Answer 1

Answer:

Case 2: Compound Interest:

At a 10% interest rate, the lender will get ₹500 extra as interest at the end of 1st year. For 2nd year, the principal amount becomes ₹5000 + ₹500 = ₹5500. So, for the 2nd year, the lender will get 10% of ₹5500 = ₹550, as the interest.