Sara deposit rs 4000 at bank at an interest rate 4.5% per year . how much interest will she earn at the end of 3 years?
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Amount Shyam will get from the bank after 2 years -
-Returns = P (1 + r)^t
-Returns = 4000 (1 + 9.5/100)^2
-Returns = 4000 × (1.095)^2
-Returns = 4000 × 1.2
-Returns = 4000 × 1.199
-Returns = 4796 Rs
-Compound interest for 2 years is -
-Compound interest = Returns - Principal
-Compound interest = 4796 - 4000
-Compound interest = 796 Rs
-Hence, Shyam will get 4796 Rs after 2 years of -which 796 is compound interest.
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