#### Calculate the amount and the compound interest on ₹ 5000 in 2 years when the rate of interest for successive years is 6% and 8%, respectively.

**Solution:**

It is given that

Principal = ₹ 5000

Period = 2 years

Rate of interest for the first year = 6%

Rate of interest for the second year = 8%

We know that

Amount for two years = P (1 + r/100)^{n}

Substituting the values

= 5000 (1 + 6/100) (1 + 8/100)

By further calculation

= 5000 × 53/50 × 27/25

= ₹ 5724

Here

Interest = A – P

Substituting the values

= 5724 – 5000

= ₹ 724

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