Discussion Forum

Simple interest on a sum of money for 3 years at $6\frac{1}{4}\%$ per annum is Rs. 2,400. What will be the compound interest on that sum at rate for the same period ?

Answer:

Explanation:

Let the sum be $P$

$\frac{(P\times\frac{25}{4}\times 3)}{100}$ $= 2400$

$P=12800$

Now $P$ $= 12800$, $N=3$, $R=6\frac{1}{4}\%$

$=12800\left[\left(1+\frac{25}{400}\right)^{3}\right]$

$=12800\times\frac{17}{16}\times\frac{17}{16}\times\frac{17}{16}$

$=15353.13$

$\therefore$ $CI$ $=15353.13-12800$ = 2553.13