Question

Find the compound interest paid when a sum of ₹ 10000 is invested for 1 year and 3 months at 17/2 % per annum compounded annually​

Answer 1

Answer:

For first year

P=10000,R=8.5%, T=1

Interest =

100

PRT

=

100

(10000×8.5×1)

=850

Amount = Interest + Principle =10000+850=Rs.10850

For second year principle will be amount of previous year (since interest is compounded)

P=10850,R=8.5%, T=3months =

12

3

years=0.25years

Interest =

100

PRT

=

100

(10850×8.5×0.25)

=Rs.230.5625

Total interest =850+230.5625=Rs.1080.5625

∴ Compound interest paid after 1 year and 3months is Rs.1080.5625