Question

Mr. Lalit invested Rs. $5,000$ at a certain rate of interest, compounded annually for two years. At the end of first year it amounts to Rs. $5,325$. Calculate the amount at the end of second year, to the nearest rupee.

Answer 1

Given: Principal $=$ Rs. $5,000$, Time $=2$ years

After one year amount $=$ Rs. $5,325$
Amount at the end of $2^{nd}$ year
$A=P{(1+\frac{r}{100})}^n$
$A=5,000{(1+\frac{65}{100})}^2=5,000{\left(\frac{106.5}{100}\right)}^2$
$A=5000\times \frac{106.5\times 106.5}{100\times 100}$
$A=$ Rs. $5671.125$
$A\approx$ Rs. $5671$