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Calculate compound interest on 1000 over a period of 1 year at 10% per annum, if
interest is compounded quarterly?
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Step by step explanation
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Answered by
1
Answer:
Rs.103.81
Step-by-step explanation:
When compounded quarterly, the rate becomes one-fourth and the time is multiplied by 4.
Principal (P) = Rs.1000
Rate (R) = 10%
Time (n) = (1×4) years = 4 years
Amount (A) = P (1 + R/100)ⁿ
=> A = 1000 (1 + 10/400)⁴
=> A = 1000 (41/40)⁴
=> A = Rs.1103.81
Compound Interest = A-P = Rs.(1103.81 - 1000) = Rs.103.81
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