Question

Rihana borrowed sum of rupees 10400 to open a book shops at the rate of 4.5 % per annum for 3 years find the compound interest paid by her after 3 years

Answer 1

The compound interest accumulation formula :

P(1 + i)ⁿ = Accumulation

P = principle amount

n = Time in years

i = interest rate

Calculations :

Principle = 10400

n = 3 years

i = 4.5%

Accumulated amount = 10400 × (1.045)³ = 10400 × 1.141166 = 11868.13

Rs 11868.13

Compound interest = 11868.13 - 10400 = 1468.13

Rs 1468.13