Mathematics
A man invests ₹ 5600 at 14% per annum compound interest for 2 years. Calculate :
(i) the interest for the first year.
(ii) the amount at the end of the first year.
(iii) the interest for the second year, correct to the nearest rupee.
Compound Interest
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Answer
(i) For first year :
P = ₹ 5600
R = 14%
T = 1 year
I = = ₹ 784
Hence, interest for the first year = ₹ 784.
(ii) Amount after first year = Principal for first year + Interest
= ₹ 5600 + ₹ 784 = ₹ 6384.
Hence, amount at the end of first year = ₹ 6384.
(iii) For second year :
P = ₹ 5600 + ₹ 784 = ₹ 6384
R = 14%
T = 1 year
I = = ₹ 893.76
Hence, interest for the second year = ₹ 894.
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