Ramesh invests ₹ 12800 for three years at the rate of 10% per annum compound interest.
Find:
(i) the sum due to Ramesh at the end of the first year.
(ii) the interest he earns for the second year.
(iii) the total amount due to him at the end of three years.
Solution:
It is given that
Principal = ₹ 12800
Rate of interest = 10% p.a.
(i) We know that
Interest for the first year = (12800 × 10 × 1)/ 100
= ₹ 1280
So the sum due at the end of first year = 12800 + 1280
= ₹ 14080
(ii) Principal for second year = ₹ 14080
So the interest for the second year = (14080 × 10 × 1)/ 100
= ₹ 1408
(iii) We know that
Sum due at the end of second year = 14080 + 1408
= ₹ 15488
Here
Principal for third year = ₹ 15488
Interest for the third year = (15488 × 10 × 1)/ 100
= ₹ 1548.80
So the total amount due to him at the end of third year = 15488 + 1548.80
= ₹ 17036.80
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