Question

Find compound interest on rs. 8500 at 4 % per annum for 2 years, compounded annually.

Answer 1

Answer:

c.i. = p (1+r/100)^t.

now a/q. 8500 (1+4/100)^2.

8500 (1+1/25)^2.

8500 (26/25)^2.

8500.26/25.26/25.

9193.6

it is the final answer.

I hope this may helps you.

Answer 2

Answer:

The compound interest is $Rs. 693.6$.

Explanation:

Given that:

Principal sum $P=Rs.8500$

Rate of interest $r=4$%

Time $n=2$ years

The formula for compound interest is :

$CI=P(1+\frac{r}{100})^n-P$

Now, substituting our values into this formula,

$CI=8500(1+\frac{4}{100})^2-8500\\\\CI=8500(\frac{26}{25}*\frac{26}{25}-1 }) \\\\CI=Rs. 693.6$

Hence, we get that the compound interest is $Rs. 693.6$

Compound interest:

• Compound interest, can be defined as the interest on principal and interest, it is the technique of adding interest to the principal amount of a loan or deposit.
• It occurs when interest is reinvested, or added to the loaned capital rather than paid out, or when the borrower is required to pay it, so that interest is generated the next period on the principal amount plus any accumulated interest.