Question

Ramesh invests Rs. 12,800 for three years at the rate of 10% per annum compound interest. Find:

1. the sum due to Ramesh at the end of the first year.
2. the interest he earns for the second year.
3. the total amount due to him at the end of the third year.

Answer 1

i. For 1^st year:

P = Rs. 12,800; R = 10% and T = 1 year

Interest = Rs. `[ 12,800 xx 10 xx 1]/100`

= Rs. 1,280

Amount = Rs. 12,800 + Rs. 1,280

= Rs. 14,080

ii. For 2^nd year:

P = Rs. 14,080; R = 10% and T = 1 year

Interest = Rs. `[ 14,080 xx 10 xx 1]/100` = Rs. 1,408.

Amount = Rs. 14,080 + Rs. 1,408

= Rs. 15,488

iii. For 3^rd year:

P = Rs. 15,488; R = 10% and T = 1 year

Interest = Rs. `[15,488 xx 10 xx 1]/[100]` = Rs. 1,548.80

Amount = Rs. 15,488 + Rs. 1,548.80 = Rs. 17,036.80