How much compound interest is earned by investing 20 000 for 6 years at
5% per annum compounded annually. ?
Answers
Answered by
4
Given :-
- Principal = Rs. 20,000
- Time = 6 years
- Rate = 5% per annum compounded annually .
To Find :-
- Compound interest = ?
Formula used :-
- CI = P[{1 + (R/100)}² - 1]
Solution :-
putting given values in above told formula we get,
→ CI = [{1+(5/100)}⁶ - 1]
→ CI = 20000[(21/20)⁶ - 1]
→ CI = 20000(1.340 - 1)
→ CI = 20000 × 0.340
→ CI = Rs.6800 (Ans.)
Answered by
11
Hi ,
Principal ( P ) = Rs 20000
Time ( t ) = 6 years
Rate of interest ( r ) = 5%
Number of times interest paid (n) = 6
Amount = P( 1 + r/100 )^n
A = 20000( 1 + 5/100 )^6
A = 20000 ( 21/20 )^6
A = Rs 26801.91
Compound interest = A - P
C.I = 26801.91 - 20000
=Rs 6801.90
I hope this helps you.
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