Question 3The compound interest on Rs 50000 at 4 per an

SOLUTION

Given, principal (P) = Rs 50000
Rate of interest (R%) = 4% per annum
Time period (T) = 2 yr
We know that,
$A=P{(1+\frac{R}{100})}^r\therefore A=50000{(1+\frac{4}{100})}^2=50000{(1+\frac{1}{25})}^2=50000\times \frac{26}{25}\times \frac{26}{25}=80\times 26\times 26=Rs.54080$
$\therefore$ Compound interest, CI = A - P = Rs 54080 - Rs 50000 = Rs 4080