Question

find amount and compound interest if principal is rs 5000,rate of interest is 8p.c.p.a,duration is 3years​

Answer 1

Solution!!

The concept of compound interest has to be used here. The principal, rate of interest and time is given. We have to find the compound interest and the amount.

We can find it with formula and without formula too.

Principal (P) = Rs 5000

Time (n) = 3 years

Rate of interest (R) = 8%

Amount = P(1 + (R/100))³

Here 3 is the time (n).

Amount = 5000(1 + (8/100))³

Amount = 5000(108/100)³

Amount = 5000(27/25)³

Amount = 5000 × (27/25) × (27/25) × (27/25)

Amount = 200 × (27) × (27/25) × (27/25)

Amount = 8 × (27) × (27) × (27/25)

Amount = 157465 ÷ 25

Amount = Rs 6298.56

Compound interest (CI) = Amount - Principal

CI = Rs 6298.56 - Rs 5000

CI = Rs 1298.56

Now let's do this without the formula.

For 1st year

Principal (P) = Rs 5000

Rate of interest (R) = 8%

Time (T) = 1 year

Interest = (P × R × T)/100

Interest = (5000 × 8 × 1)/100

Interest = 50 × 8

Interest = Rs 400

Amount = Principal + Interest

Amount = Rs 5000 + Rs 400

Amount = Rs 5400

For 2nd year

The amount in the 1st year will be the principal in the 2nd year.

Principal (P) = Rs 5400

Rate of interest (R) = 8%

Time (T) = 1 year

Interest = (P × R × T)/100

Interest = (5400 × 8 × 1)/100

Interest = 54 × 8

Interest = Rs 432

Amount = Principal + Interest

Amount = Rs 5400 + Rs 432

Amount = Rs 5832

For 3rd year

The amount in the 2nd year will be the principal in the 3rd year.

Principal (P) = Rs 5832

Rate of interest (R) = 8%

Time (T) = 1 year

Interest = (P × R × T)/100

Interest = (5832 × 8 × 1)/100

Interest = 46656/100

Interest = Rs 466.56

Amount = Principal + Interest

Amount = Rs 5832 + Rs 466.56

Amount = Rs 6298.56

Compound interest (CI) = Interest in the 1st year + Interest in the 2nd year + Interest in the 3rd year

CI = Rs 400 + Rs 432 + Rs 466.56

CI = Rs 1298.56

Answer 2

Given :

• Principal (P) = Rs 5000
• Rate (R) = 8% per annum
• Time (n) = 3 years

To Find :

• Amount
• Compound interest

Solution :

⇒ Amount = Principal (1 + Rate/100)^n

⇒ A = 5000 (1 + 8/100)³

⇒ A = 5000 (108/100)³

⇒ A = 5000 × 108/100 × 108/100 × 108/100

⇒ A = 5 × 108 × 108/10 × 108/100

⇒ A = 5 × 108 × 108 × 108/1000

⇒ A = 540 × 11,664 /1000

⇒ A = 6,298,560 /1000

⇒ Amount = Rs 6,298.56

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⇢ Compound Interest = Amount - Principal

⇢ Compound Interest = 6298.56 - 5000

⇢ Compound Interest = Rs 1,298.56

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Therefore :

• Amount = Rs 6298.56
• Compound interest = Rs 1298.56

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