Question

Find compound interest on $7000 at 10% per annum for 2 year 5 months compounded annually​

Answer 1

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Answer 2

Given:

Principal (P) = $7000

Rate (r) = 10 %

Time (n) = 2 years 5 months

To find:

Compound interest=?

Solution:

Formula:

A = P(1+r/100)n

Compound interest=A-P

Calculate time into months:

in one year total 12 months

time = 2 years 5 months,

total months:

= 24+5/12

=29/12

=2.41

put the value in the given formula:

A = 7000(1+10/100)2.41

A= 7000(11/10)2.41

A= 7000 × 1.1)2.41

A = 7000 × 1.25

A= 8,750

Finding compound interest:

C.I= A-P

C.I= 8,750 - 7000

C.I = 1,750