Question

Calculate the amount and compound interest on ₹10,800 for 3 years at $12\frac{1}{2}$% per annum compounded annually.

Answer 1

Given,
Principal (P) = ₹10,800
rate of interest (r) = $12\frac{1}{2}$%
Time (n) = 3 years
So, Amount (A) $=P\times {(1+\frac{r}{100})}^n$$=₹10,800{(1+\frac{12\frac{1}{2}}{100})}^3=₹10,800{(1+\frac{25}{200})}^3=₹10,800\times {(1.25)}^3=₹15,377.3$
Compound interest = ₹15,377.3 - ₹10,800 = ₹4,577.3