Question

Calculate the amount and compound interest on
$Rs10,800$ for $3years$ at $12\frac{1}{2}\%$ per annum compound annually.

Answer 1

Given:Principal$P=$Rs.$10800$

Time $=3$years

Rate $R=12\frac{1}{2}$ per annum compounded annually$=\frac{25}{2}\%$

Amount $A=P{(1+\frac{R}{100})}^n$

$=10800{(1+\frac{\frac{25}{2}}{100})}^3$

$=10800{(1+\frac{25}{200})}^3$

$=10800{(1+\frac{1}{8})}^3$

$=10800{\left(\frac{8+1}{8}\right)}^3$

$=10800{\left(\frac{9}{8}\right)}^3$

$=10800\times \frac{81\times 9}{2\times 64}$

$=\frac{1968300}{128}=15377.34$

$\therefore$ Amount after $3$ years$=$Rs.$15,377.34$

Now, Amount$=$Principal$+$Interest

$15,377.34=10800+$Interest

$\Rightarrow$ Interest$=15,377.34-10800=4577.34$

$\therefore$ Interest$=Rs.$4577.34$