Question

find the interest earned on 5000 for 2 years at 12 % per annum compounded annually.​

Answer 1

Answer:

☆ Solution ☆

The required compound interest is ₹ 1272.

To Find :-

The compound interest.

Step-by-Step-Explaination :-

We that the amount A at the end of n years at the rate of R% per annum when the interest is compounded annually is given by

A = P ( 1 + R/100 )^ n

Here, Principal ( P ) = 5000 , R = 12 % p.a. and n = 2 years

Therefore,

Amount ( A ) after 2 years

= ₹ 5000 ( 1 + 12/100 )²

= ₹ 5000 ( 112/100 )²

= ₹ 5000 × 112/100 × 112/100 = 6272

Now,

Compound Interest

= Amount (A) - Principal (P)

= ₹ 6272 - ₹5000

= ₹ 1272

Hence,

The required compound interest is ₹ 1272.