• Login via
  • or
  • New here ?

The simple interest on a sum of money for 3 years at 6²/3 % per annum is $ 6750. What will be the compound interest on the same sum at the same rate for the same period, compounded annually?

A.8125
B.6655
C.4496
D.7210
Answer and Feedback
Answer:D
Feedback:Given, SI = $ 6750, R = 203% p.a. and T = 3 years.
sum = 100 × SI / R × T
= $ (100 × 6750 × ³/20 × 1/3 ) = $ 33750.
Now, P = $ 33750, R = 203% p.a. and T = 3 years.
Therefore, amount after 3 years
= $ {33750 × (1 + (20/3 × 100)}³ [using A = P (1 + R/100)]
= $ (33750 × 16/15 × 16/15 × 16/15) = $ 40960
Thus, amount = $ 40960
Hence, compound interest = $ (40960 - 33750) = $ 7210

do you want?

view more test

Share this post

Some other questions you may be interested in.

Loading...