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Rs.16,000 is invested at 5% compound interest compounded per annum. Use the table, given below, to find the amount in 4 years. Year ↓ Initial amount (Rs.) Interest (Rs.) Final amount (Rs.)

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Question

Rs.16,000 is invested at 5% compound interest compounded per annum. Use the table, given below, to find the amount in 4 years.

Year ↓ 

Initial amount  (Rs.)

Interest (Rs.)

Final amount (Rs.)

1st 16,000 800 16,800
2nd ........... ........... ...........
3rd ........... ........... ...........
4th ........... ........... ...........
5th ........... ........... ...........
Sum
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Solution

Year ↓ 

Initial amount  (Rs.)

Interest (Rs.)

Final amount (Rs.)

1st 16,000 800 16,800
2nd 16,800 840 17,640
3rd 17,640 882 18,522
4th 18,522 926.10 19,448.10
5th 19,448.10 972.405 20,420.505

1. P = ₹ 16,000, R = 5%

For 1st year 

I = `(PxxRxxT)/100`

= `(16000xx5xx1)/100`

= ₹ 800

A1 = P + I

= 16000 + 800

= 16800

2. For 2nd year

P = ₹ 16,800, R = 5%, T = 1

I2 = `(16800xx5xx1)/100`

I2 = ₹ 840

A2 = P2 + I2

= 16800 + 840

= 17640

3. For 3rd year

P = 17640, R = 5%

I3 = `(17640xx5xx1)/100`

= 882

A3 = P3 + I3 

= 17640 + 882 

= 18522

4. For 4th year

P = 18522, R = 5%

I4 = `(18522xx5xx1)/100`

= 9261

A4 = 18522 + 926.1

= 19448.10

5. For 5th year

P5 = 19448.10, R = 5%

I5 = `(19448.10xx5xx1)/100`

= `97240.5/100`

= 972.40

A5 = 19448.10 + 972.40

= 20420.50

Thus, the amount in 4 years is Rs. 19448.10.

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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 (Without using formula) - Exercise 2 (A) [Page 28]

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Selina Concise Mathematics [English] Class 9 ICSE
Chapter 2 Compound Interest (Without using formula)
Exercise 2 (A) | Q 1 | Page 28

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