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Calculate the compound interest on Rs. 5,000 in 2 years; if the rates of interest for successive years be 10% and 12% respectively.

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Question

Calculate the compound interest on Rs. 5,000 in 2 years; if the rates of interest for successive years be 10% and 12% respectively.

Sum
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Solution

For 1st year

Principal (P) = Rs. 5,000, Rate (R) = 10%, Time (T) = 1 year

∴ Interest = `(5,000xx10xx1)/100` = 50 × 10 = Rs. 500

∴ Amount at the end of 1st year = Rs. (5000 + 500) = Rs. 5500

For 2nd year

P = Rs. 5500, Rate = 12%, T = 1 year

∴ Interest = `(5500xx12xx1)/100` = 55 × 12 = Rs. 660

∴ Amount at the end of 2nd year = Rs. 5500 + Rs. 660 = Rs. 6160

Hence compound interest = Rs. 6160 − Rs. 5000 = Rs. 1160

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Chapter 9: Interest - Exercise 9 (C) [Page 114]

APPEARS IN

Selina Concise Mathematics [English] Class 8 ICSE
Chapter 9 Interest
Exercise 9 (C) | Q 5 | Page 114

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