There is 60% increase in an amount in 6 years at simple interest. What will be the compound interest of Rs 12000 after 3 years at the same rate?

Given

60% increase in amount in 6 years at Simple Interest

We need to find CI of Rs 12000 after 3 years at same rate

We know that,

SI = (P x R x T)/100

Where,

SI = Simple Interest

P = Principle

R = Rate of Interest

T = Time period

A = SI + P

Where,

A = amount

Let Rs P be the Principal

A = P + 60% of P

A = P + (60/100)P

We get,

A = (8P/5) ………. (1)

Now consider

A = SI + P

Put the value of A from equation (1)

8P/5 = [(P x R x 6)/100] + P

8/5 = 6R/100 + 1

We get,

R = 10% ……… (2)

For Compound Interest

A = P (1 + R/100)n where n = time period

A = 12000 (1 + 10/100)3 {putting value of R from equation (2)}

A = Rs 15972 ….(4)

Compound Interest = Amount – Principal

CI = 15972 – 12000

CI = Rs 3972

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