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Simple interest on a certain sum at 7 p.c.p.a for four years is Rs. 3584. What will be the compound interest on the same principal at 4 p.c.p.a. in two years ?
- ARs. 1054.48
- BRs. 1044.48
- CRs. 1044.84
- DRs. 1064.84
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Solution
Let the principal amount be P and given that R = 7%/ annum and T = 4 years, S.I for 4 years = Rs 3584
S.I. = $\frac{P \times R \times T}{100}$ = $\frac{P \times 7 \times 4}{100}$ = 3584
P = Rs 12800
Now , to calculate the C.I rate of interest has been changed to 4%/ annum and time period to 2 years
C.I. = P$(1 + \frac{4}{100})^2$ - P
= 12800(1.0816-1)
= 12800 x 0.0816
= Rs. 1044.48
Let the principal amount be P and given that R = 7%/ annum and T = 4 years, S.I for 4 years = Rs 3584
S.I. = $\frac{P \times R \times T}{100}$ = $\frac{P \times 7 \times 4}{100}$ = 3584
P = Rs 12800
Now , to calculate the C.I rate of interest has been changed to 4%/ annum and time period to 2 years
C.I. = P$(1 + \frac{4}{100})^2$ - P
= 12800(1.0816-1)
= 12800 x 0.0816
= Rs. 1044.48