Question
What is the compound interest on a sum of Rs 12,000 for
2(5/8) years at 8% p.a., when the interest is compounded annually? (nearest to a rupee)Solution
Interest rate for first 2 years = 8% Interest rate for 5/8 years = (5/8) × 8 = 5% P = Rs.12000 According To question, =>A = P (1 + R/100)3 => A = 12000 × (108/100) × (108/100) × (105/100) => A = Rs.14697 Therefore, CI = 14697 – 12000 = Rs.2697
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