If the simple interest on a sum of money for 2 years at 5% per annum is Rs. 50, what is the compound interest on the same at the same rate and for the same time?
papay dey Answered question February 15, 2025
Simple Interest (SI) formula:
SI = (P × R × Time) / 100
Given values:
SI = Rs. 50
R = 5% per annum
Time = 2 years
Rearrange the SI formula to solve for P:
P = (SI × 100) / (R × Time)
= (50 × 100) / (5 × 2)
= 500
Now, calculate the Compound Interest (CI):
CI = P × (1 + R/100)^Time – P
= 500 × (1 + 5/100)^2 – 500
= 500 × (1.05)^2 – 500
= 500 × 1.1025 – 500
= 551.25 – 500
= 51.25
The compound interest is Rs. 51.25.
papay dey Answered question February 15, 2025
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