Aptitude Day 311

Problems on Compound Interest:

1. Find the compound interest (C.I.)on 1000 in 1 year at 8% p.a, the interest being compounded half-yearly.

Solution:

                  Amount = 1000*(1 + 8/2/100)²

                                = 1000*(104/100)² 

                                = 1000 * 26/25 * 26/25 

                                = 5408/5 

                                = 1081.6.

                  C.I = 1081.6 – 1000 = 81.6.

2. In what time will 8000 become 9261 at 5% p.a. compounded annually? 

Solution:

                 8000(1 + 5/100)ⁿ = 9261

                 (21/20)ⁿ = 9261/8000 

                               = (21/20)³

                 n = 3.