You have deposited ₹1000 in the bank. There is a 7% interest on it every year. How much money will you get after 5 years?
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Solution
Here, principal (P) = ₹1000
Rate of interest (R) = 7%
Time period (T) = 5 years
We know that simple interest, SI=P×R×T100 ⇒SI=1000×7×5100 ⇒SI=₹350 [1mark]
Hence, after 5 years, the total amount = Principal + Interest = ₹1000 + ₹350 = ₹1350 [1mark]