#### Question

To start a business Shalaka has taken a loan of ₹8000 at a rate of 10 `1/2` p.c.p.a. After two years how much compound interest will she have to pay?

#### Solution

Here, P = ₹ 8000; R = 10 `1/2` % ; N = 2 years

A = P `(1 + R/100)^N`

= 8000 `(1 + (10 1/2)/100)^2`

= 8000 `(1 + 21/200)^2`

= 8000 `(221/200)^2`

= 9768.20 Rupees

Compound interest after 2 years,

I = Amount - Principal

= 9768.20 - 8000

= 1768.20 Rupees

Hence, she will have to pay a compound interest of ₹ 1768.20 after 2 years.

Is there an error in this question or solution?

Solution To Start a Business Shalaka Has Taken a Loan of ₹8000 at a Rate of 10 1 2 P.C.P.A. After Two Years How Much Compound Interest Will She Have to Pay? Concept: Application of Formula for Compound Interest.