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Question

Find the amount and the compound interest on 5000 for 2 years at 6% per annum, interest payable yearly.

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Solution

It is given that
Principal (P) = 5000
Rate of interest (r) = 6% p.a.
Period (n) = 2 years
We Know that
Amount = P(1+r/100)n
Substituting the values
=5000(1+6/100)2
By further calculation
= 5000×53/50×53/50
= 5618
Here
CI = A - P
Substituting the values
=56185000
= 618

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