Question

The simple interest on certain sum of money for 3 years at 5% per annum is 600 rupees find the amount due to the compound interest on this sum of money at the same rate after 3 year interest being compounded annually

Answer 1

s.i = 600

time =3 yrs

rate = 5

principle=x

s.i=ptr divided by 100= xx5x3divided by 100=3x/20

s.i=3x/20

600=3x/20

x=4000

principle =4000

compound intrest ={1+5/100} x{5/100+1}x{1+5/100}x4000

=4630.5

c.i=630.5

Answer 2

Simple interest = 600, time = 3 yrs, rate = 5%

We have S . I = P x R x T /100

               600 = P x 5 x 3 /100 or 15 p = 60000 or p = 60,000 / 15

                          P = Rs 4000.

     Now Amount = P(1 + r/100) ^n

                          = 4000 ( 1 + 5/100)^3

                       = 4000 ( 105/100)^3

                            = 4000 (21/20)^3

                           =  1.05 x 1.05 x 1.05 x 4000

                      Amount = Rs 4,630.5

Compound Interest = A - P = 4,630.5 - 4000

                              =  Rs 630.5