Question

How much will rs. 25000 amount to in 2 years at compound interest, if the rates for the successive years be 4 and % p.a.

Answer 1

P= rs. 25000

R= 4%

n= 2 years

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

   = 25000(1+4/100)^2

   =25000(1+1/25)^2

   = 25000{(25+1)/25}^2

  = 25000*(26/25)*(26/25)

  = 1000*26*(26/25)

 = 40*26*26

 = rs. 27040

So, the amount is rs. 27040