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Find the Compound Interest on Rs. 4,000 Accrued in Three Years, When the Rate of Interest is 8% for the First Year and 10% per Year for the Second and the Third Years.

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Question

Find the compound interest on Rs. 4,000 accrued in three years, when the rate of interest is 8% for the first year and 10% per year for the second and the third years.

Sum
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Solution

Interest for the first year = `["P" xx "R" xx "T"]/100`                         

                                        = `[ 4,000 xx 8 xx 1 ]/100`
                                        = Rs. 3,20
Amount for the first year = Rs. 4,000 + Rs. 3,20 = Rs. 4,320

Interest for the second year = `["P" xx "R" xx "T"]/100`

                                             = `[ 4,320 xx 10 xx 1]/100`
                                             = Rs. 432

Amount for the second year = Rs. 4,320 + Rs. 432 = Rs. 4,752

Interest for the third year = `["P" xx "R" xx "T"]/100`   

                                          = `[4,752 xx 10 xx 1]/100`

                                          = Rs. 475.20

Amount for the third year = Rs. 4,752 + Rs. 475.20 = Rs. 5,227.20

So, the compound interest = Rs. 5,227.20 - Rs. 4,000 = Rs. 1,227.20

Hence, the amount will get at the end of the third year is Rs. 1,227.20.

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Concept of Compound Interest - Compound Interest as a Repeated Simple Interest Computation with a Growing Principal
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Chapter 2: Compound Interest (Stage 1) [Basic Concepts] - Exercise 2 (A) [Page 28]

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Selina Concise Mathematics [English] Class 9 ICSE
Chapter 2 Compound Interest (Stage 1) [Basic Concepts]
Exercise 2 (A) | Q 10 | Page 28
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