Question

Simple interest on a sum of money for 2 years at 6% per annum is Rs.5200. What
will be the compound interest on the sum at the same rate for the same period​

Answer 1

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Given details are,

Rate = 6 ½ % per annum = 13/2%

Simple Interest (SI) = Rs 5200

Time (t) = 2 years

By using the formula,

SI = (PTR)/100

P = (SI×100) / (T×R)

= (5200×100) / (2×13/2)

= (5200×100×2) / (2×13)

= 1040000/26

= Rs 40000

Now,

P = Rs 40000

R = 13/2% = 6.5%

T = 2years

By using the formula,

A = P (1 + R/100) n

= 40000 (1 + 6.5/100)2

= 40000 (106.5/100)2

= Rs 45369

∴ CI = Rs 45369 – 40000

= Rs 5369

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