Question

the simple interest on the sum of money for 3 years at 20/3% per annum is 8750 what will be the compound interest on the same sum at the same rate for same period compound annually

Answer 1

Interest formulae for simple interest :

Principle × rate × time

Principle = p

rate = 20/3

Time = 3 years

8750 = p × 20/300 × 3

8750 = 0.2p

P = 8750/0.2 = 43750

Compound interest accumulation factor :

P(1 + i)ⁿ

43750(1.06667)³ = 43750 × 1.2136 = 53096.79

Interest :

53096.79 - 43750 =9346.79

Answer 2

Step-by-step explanation:

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