Question

A man invests Rs. $30,800$ at $5$% per annum compound interest for $3$ years. Calculate the amount standing to his credit at the end of the second year.

Answer 1

For the first year

$P=Rs30,800$
$N=1year$
$R=5$ %
We have $S.I.=\frac{PNR}{100}=\frac{30,800\times 1\times 5}{100}=Rs1,540$
And Amount at the end of first year $P+S.I.=Rs30,800+Rs1,540=Rs32,340$
Now, for the second year
$P=Rs32,340$
$N=1year$
$R=5$ %
We have $S.I.=\frac{PNR}{100}=\frac{32,340\times 1\times 5}{100}=Rs1617$
And Amount at the end of second year $P+S.I.=Rs32,340+Rs1617=Rs33,957$