Question

Find compound interest on a sum Rs 8000 2years at 5percent per annum compounded annually

Answer 1

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Given:-

• Principal (P) = ₹ 8000
• Time period (N) = 2 years
• Rate of interest (R) = 5%

To find :-

• Amount (A)
• Compound Interest (CI)

Solution :-

To find compound interest, we need to first calculate the Amount.

Amount is calculated via using the formula,

A = P ( 1 + $\bf\large\frac{R}{100})^n$

Plug the values in the above formula,

A = 8000 ( 1 + $\bf\large\frac{5}{100})^2$

A = 8000 ( $\bf\large\frac{100+5}{100})^2$

A = 8000 ( $\bf\large\frac{105}{100})^2$

A = 8000 × $\bf\large\frac{11025}{10000}$

A = 8 × $\bf\large\frac{11025}{10}$

A = 8 × 1102.5

A = 8,820

•°•Amount (A) = ₹ 8,820

Now, using this amount we can calculate the compound interest by simply subtracting it from Principlal amount.

CI = Amount - Principal

CI = 8820 - 8000

CI = 820

•°• Compound interest = ₹820