Question

Let us calculate the differences between the compound interest and simple interest on $10,000 for 3 yrs at 5% interest per annum.​

Answer 1

Answer:

The amount of Rs. 10000 for 3 years at 5% compound interest per annum

=Rs.10000×(1+5100)3=Rs.10000×(105100)3

=Rs.1000×105×105×105100×100×100=rs.11576.25

∴ The compound interest =Rs.(11576.25−10000)=Rs.1576.25

Again the simple interest for 3 years of Rs. 10000 at 5% per annum

=Rs.10000×5×3100=Rs.1500

Hence the required difference =Rs.(1576.25−1500)=Rs.76.25