Question

Find the compound interest on 4,000 accrued in three years,when the rate of interest is 8%for the first year and 10%per year for the second and the third year

Answer 1

P=4000
Interest for 1st year at 8% = 4000*8/100 = 320
Now A = P+C.I=4000+320 = 4320

Since its being compounded, this A becomes P for second year:
P=4320
Interest for 2nd year = 4320*10/100 = 432
Now A = 4320+432 = 4752

P for 3rd year = 4752
Interest at 10% = 4752*10/100 = 475.2
Hence total interest for 3 years = 320+432+475.2 = 1227.2
Hence C.I for Rs.4000 @ 8%(1st yr), 10%(2nd yr), 10%(3rd yr) = Rs.1227.2

Alternatively:
Amount for 3 years = P[(1 + r1/100) * (1 + r2/100) * (1 + r3/100)] 
                                = 4000*[(1 +8/100) *(1 + 10/100)*(1+10/100)]
                                =4000*108*110*110/100*100*100 = 5227.2
C.I = A - P = 5227.2 - 4000 = 1227.2

Hope it helps.