Question

Calculate the compound interest on Rs. $5000$ for $3$ years at $8\%$ per annum,compounded annually.

Answer 1

Principal $=$Rs. $5000$

Time $=3$ years

Rate $=8\%$

Amount compounded annually

$=5000\cdot {(1+\frac{8}{100})}^3$

$=5000\cdot \frac{108}{100}\cdot \frac{108}{100}\cdot \frac{108}{100}$

$=$Rs. $6298.56$

Compound interest $=$Rs. $6298.56-$Rs. $5000$

$=$Rs. $1298.56$.