Question

find the amount and compound interest on ₹6500 for 2 years, compounded annually, the rate of interest being 5% per annum during the first year and 6% per annum during the second year.

Answer 1

Your answer

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Given,

P = ₹ 6500

T = 2 years

Rate for 1st year, q = 5 % p. a.

Rate for 2nd year , R = 6 % p. a.

Now,

Amount after 2 years

$= p \times (1 + \frac{q}{100} ) \times (1 + \frac{r}{100} )$

$= 6500 \times (1 + \frac{5}{100} ) \times (1 + \frac{6}{100} )$

$= 62500 \times ( \frac{100 + 5}{100} ) \times (\frac{100 + 6}{100} )$

$= 62500 \times \frac{105}{100} \times \frac{106}{100}$

$= 7234.5$

Amount after 2 years = ₹ 7234.5

CI = A – P

= ₹ ( 7234.5 – 6500 )

= ₹ 734.5

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Hope it help you