Given, the principal = Rs. 40000, rate of interest = 8% per annum compound annually. Find Interest if period is one year.
Given, principal (P)= Rs. 40000
Rate of interest (R) = 8% per annum
Compound interest for one year,
We know that,
A=P(1+R100)n=40000(1+8100)1 [∵ n=1yr]=40000×108100∴ Amount, A=400×108=Rs.43200
∴ Compound interest, CI = A - P = Rs. 43200 - Rs. 40000 = Rs. 3200