What is the compound interest on 25,000 for 3 years at 10% per annum compounded yearly?
Show answer & explanation
Correct answer: D
Explanation
The correct answer is option 4 i.e. 8,275.
Principal P = 25,000
t = 3 years
r = 10%
Compound interest = CI
CI = P{1 + r/100)t - 1}
CI = 25000{1 + 10/100)3 - 1}
CI = 25000{1331/1000 - 1}
CI = 25000 × 331/1000
CI = Rs 8275