Question

Manisha deposit rupees 1000 at 5% per annum of compound interest for 3 years with State Bank of India what will she get back at the expiry of the period​

Answer 1

Answer:

157.625

Step-by-step explanation:

1000*9261/8000-1000

=1157.625-1000

=157.625

Answer 2

She will get 1156.625 rs after the expiry of the period.

•Compound interest is interest compounded to the amount after one cycle of compound interest.

•Example: if a% is compounded annually for 2 years, after 1 year the interest will apply on the initial amount + the interest amount after 1 year.

Hence in this question we have the initial amount as 1000 rs and the interest rate is 5% per annum interest compounded for 3 years.

After one year the amount will be:-

1000 + 5% x 1000 =1050.

After 2 years it will be :-

1050 + 5% x 1050 = 1102.5.

After 3 years it will be:-

1102.5 + 5% x 1102.5 = 1157.625 which is the answer.

Hence she will get 1156.625 rs after the expiration period.