Question

Calculate the amount and the compound interest on:

Rs. 16,000 in 3 years, when the rates of the interest for successive years are 10%, 14% and 15% respectively.

Answer 1

For 1^st year

P = Rs. 16000; R = 10%; T = 1 year

I = `[16000 xx 10 xx 1]/100`

I = Rs. 1600

A = 16000 + 1600 = 17600

For 2^nd year,

P = Rs. 17600; R = 14%; T = 1 year

I = `[17600 xx 14 xx 1]/100 = 246400/100`

I = Rs. 2464.

A = 17600 + 2464 = Rs. 20064

For 3^rd year,

P = Rs. 20064; R = 15%; T = 1 year

I = `[20064 xx 15 xx 1]/100`

I = 3009.60

Amount after 3 years = 20064 + 3009.60 = Rs. 23073.60

Compound interest = 23073.60 - 16000 = Rs. 7073.60