Compound Interest Calculation for Fixed Deposit
This problem involves calculating the final amount Mahesh will receive from a fixed deposit after 2 years, considering compound interest.
Key Information
- Principal Amount ($P$): ₹8000
- Rate of Interest ($r$): 5% per annum
- Time Period ($n$): 2 years
- Interest Type: Compound Interest
Formula for Compound Amount
The formula to calculate the amount ($A$) on maturity with compound interest is:
$A = P \times (1 + \frac{r}{100})^n$
Step-by-Step Calculation
- Substitute values into the formula:
$A = 8000 \times (1 + \frac{5}{100})^2$
- Simplify the term inside the parenthesis:
$1 + \frac{5}{100} = 1 + 0.05 = 1.05$
So the formula becomes:
$A = 8000 \times (1.05)^2$
- Calculate the square of the term:
$(1.05)^2 = 1.1025$
Now the formula is:
$A = 8000 \times 1.1025$
- Calculate the final amount:
$A = 8820$
Maturity Amount
Mahesh will receive ₹8820 on the maturity of the fixed deposit.
Similar Questions
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Important Questions from Compound Interest
A person borrowed Rs. 10000 on compound interest at the rate of 40 percent per annum. If the interest is compounded half yearly, then what will be the amount to be paid after 1.5 years?
The difference between the compound interest (compounding annually) and the simple interest on a sum of money at the rate of 40 per cent per annum for 2 years is Rs. 2400. What is the amount?
In how many years will a sum of Rs.1875 amount to Rs.2187 at 8 percent p.a. compound interest?
A sum of money has increased by 45% in 9 years at simple interest. What will be the compound interest of Rs. 12,000 after 3 years at the same rate?
At a certain rate of compound interest a certain sum amounts to Rs. 64800 in 4 years and Rs. 93312 in 6 years. What is the compound interest earned in fifth year?
