Question

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

Answer 1

Given principal amount $P=Rs.10800$
time $t=2\frac{1}{2}=\frac{5}{2}years$
rate $r=10\%=\frac{10}{100}=0.1$

Since, we have total amount $=A=P(1+r{)}^t$
By substituting given values, we get
Now, $A=10800(1+0.1{)}^{\frac{5}{2}}$
$=10800(1.1{)}^{\frac{5}{2}}$
$=10800\times 1.2691$
Therefore, Amount $=Rs.13705.83$

Hence, the Compound interest is $CI=A-P$

$=Rs.13705.83-Rs.10800$

$=Rs.2905.83$