Question

Compute the amount and the compound interest by using the formulae when : Principal = Rs 5000, Rate = 10 paise per rupee per annum, Time = 2 years.

Answer 1

Given, P = Rs 5000, rate = 10%, time = 2years

A = P (1 + R/100)n

= 5000 (1 + 10/100)2

= 5000 (110/100)2

= Rs 6050

Compound interest (CI) = A-P = Rs 6050 – 5000 = Rs 1050