Question

find the compound interest of Rs. 8,000 at 4% p.a. for 3years

Answer 1

Solution :-

Principal = Rs. 8000
Rate of Interest = 4 %
Time = 3 years

A = P(1 + R/100)ⁿ

A = 8000(1 + 4/100)³

A = 8000*104/100*104/100*104/100

A = 8998.912
 
So, Amount is Rs. 8998.912

Compound Interest = Amount - Principal

Compound Interest = 8998.912 - 8000

Compound Interest = Rs. 998.912

Answer.

Answer 2

In this question, we use the compound interest accumulation function for interest.

The accumulation function for interest is :(i/100)^n

In this case i=4%

The accumulation factor is:(0. 04)^3
=0.1248

The compound interest =accumulation factor for interest × the principal =8000×0.1248=998.40

Rs998.40