Question

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

Answer 1

Here, $Principal,P=10,800$

$Time,n=3$ years

$Rate,R=12\frac{1}{2}\%=\frac{25}{2}\%$

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

$=10,800{(1+\frac{25}{200})}^3$

$=10,800{\left(\frac{225}{200}\right)}^3$

$=10,800\times \frac{225}{200}\times \frac{225}{200}\times \frac{225}{200}$

$=108\times \frac{225}{2}\times \frac{225}{200}\times \frac{225}{200}$

$=54\times \frac{225}{1}\times \frac{225}{200}\times \frac{225}{200}$

$=27\times \frac{225}{1}\times \frac{225}{100}\times \frac{225}{200}$

$=13.5\times \frac{225}{1}\times \frac{225}{100}\times \frac{225}{100}$

$=\frac{13.5\times 225\times 225\times 225}{100\times 100}$

$=13.5\times 2.25\times 2.25\times 225$

$A=Rs15377.34$

Compound Interest $=$ Amount $-P$

$=15377.34-10,800$

$=Rs4577.34$