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Calculate the compound interest on 5,000 in 2 years; if the rates of interest for successiveyears be 10% and 12% respectively. |
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Answer» -step explanation:For 1st yearPrincipal (P) = Rs. 5,000Rate (R) = 10%Time (T) = 1 Year∴ INTEREST = (5,000 × 10 × 1)/100 = 50 × 10 = Rs. 500∴ Amount at the end of 1ST year = Rs. (5000 + 500) = Rs. 5500For 2nd yearP = Rs. 5550Rate 12%T = 1 year∴ Interest = (5500 × 12 × 1)/100 = 55 × 12 = Rs. 660∴ Amount at the end of 2nd year= Rs. 5500 + Rs. 660 = Rs. 6160Hence compound interest = Rs. 6160 – Rs. 5000= Rs. 1160 |
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