Question

Tick the correct answer in each of the following:

A sum of Rs 25000 was given as loan on compound interest for 3 years compounded annually at $5\%$ per annum during the first year, $6\%$ per annum during the second year and $8\%$ per annum during the third year. The compound interest is

(a) Rs 5035 (b) Rs 5051 (c) Rs 5072 (d) Rs 5150

Answer 1

$\text{Principal (P) = Rs. 25000}\text{Rate}\left(R_1\right)=5\%\text{for the first year}{R}_2=6\%\text{for the second year}{R}_3=8\%\text{for the third year}\therefore \text{Amount (A) = P}(1+\frac{R_1}{100})(1+\frac{R_2}{100})(1+\frac{R_3}{100})=Rs.25000(1+\frac{5}{100})(1+\frac{6}{100})(1+\frac{8}{100})=Rs.25000\times \frac{21}{20}\times \frac{53}{50}\times \frac{27}{25}=Rs.30051\therefore \text{C.I. = A - P = Rs. 30051 = 25000}=Rs.5051\left(b\right)$