Question

Find the Compound interest on Rs 8000 for 3 years at 5% per annum.

Answer 1

Hint: making use of the formula of compound interest.
$p {\left( {1 + \dfrac{R}{{100}}} \right)^t}$. Where P is Principal, R is Rate, t is time.

Complete step-by-step answer:

In the given question we are provided
Principle, P=8000
Rate, R=5%
Time, t=3
Making use of formula
$P {\left( {1 + \dfrac{R}{{100}}} \right)^t}$. Substitute the values in this formula, we get
$
  8000{\left( {1 + \dfrac{5}{{100}}} \right)^3} \\
   = 8000{\left( {\dfrac{{105}}{{100}}} \right)^3} \\
   = 8000 \times \dfrac{{105}}{{100}} \times \dfrac{{105}}{{100}} \times \dfrac{{105}}{{100}} \\
   = 9261 \\
 $
So compound interest is 9261.

Note: For per annum compound interest is calculated for the whole year. But if in a question it was asked for half-yearly too we have to take a time period of 6 months. The calculation should be done properly.