Mathematics

ALLEN
Compound Interest

12,00,000 Compound Interest VS Simple Interest

10.83
Lakhs
10,00,000 Simple Interest Compound Interest "We are already familiar with
ratio and [Link] a
8,00,000 simple case the profit or loss
equals the increase or
6,00,000 decrease in the company's
3.5 Lakhs
assets. In order to understand
4,00,000
how various type of transation
works, this chapter helps to
2,00,000
have a complete understanding
of simple interestand compound
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 interest."
Year

3.1 Interest
It is the additional money besides the original money paid by the borrower
to the moneylender (bank, financial agency or individual) in lieu of the
money used by him.
Principal : The money borrowed (or the money lent) is called principal.
Amount : The sum of the principal and the interest is called amount.
Thus, amount = principal + interest.
Rate: It is the interest paid on `100 for a specified period.
Time: It is the time for which the money is borrowed.
Simple interest: It is the interest calculated on the original money (principal)
for any given time and rate.

Principal × Rate × Time

Formula : Simple Interest = .
100
3.2 Compound interest
We know that in case of simple interest the principal P remains the same
for the whole period of borrowing. But, in practice, most of the
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moneylenders such as banks and the lending agencies add the simple
interest I at the end of one year (or any other specified time such as six
months or three months) to the principal P if the duration of borrowing is
more than one year. This sum P + I (i.e., amount at the end of one year)
will be the new principal for the next year of borrowing for calculating the
simple interest for the second year. This process is repeated till the last
year of the period. When the interest for a longer period is calculated like
this, the interest is called compound interest.
Thus, (i) the compound interest on a principal P for 2 years
= (simple interest I on the principal P for one year)
+ (simple interest I' on the new principal (P + I), that is, the amount at
the end of 1 year, for one year)

45
ICSE : Class IX
ALLEN
(ii) the compound interest on a principal P for 3 years =
(simple interest I on the principal P for one year)
+ (simple interest I' on the new principal (P + I), that is, the amount at
the end of 1 year, for one year)
+ (simple interest I" on the new principal (P + I + I'), that is, the amount
at the end of 2 years, for one year)
This method of calculating compound interest is known as the method of
repeated simple interest computation with a growing principal.
Clearly, the compound interest on a principal P for 1 year
= simple interest on a principal for 1 year, when the interest is calculated
yearly.
The compound interest on a principal for 2 year > the simple interest on
the same principal for 2 years.
Remember, if the principal = P, amount at the end of the period = A and
compound interest = CI, CI = A – P.
3.3 Formula for compound interest
Compound interest (abbreviated C.I.) can be easily calculated by the following
formula:

æ r ö÷
n
Formula: A < P çç1 ∗ ÷÷
çè 100 ø
Where A is the final amount, P is the principal, r is the rate of interest
THE compounded yearly and n is the number of years.
SPOT P æ
C.I. < A , P < P çç1 ∗
r ö÷
n éæ
÷÷ , P < P êêçç1 ∗
r ö÷
n ù
÷÷ , 1úú .
LIGHT çè 100 ø êëèç 100 ø úû
Interest on a given sum can be
calculated by applying the idea of
percent and unitary method. BUILDING CONCEPTS 3.1
Find the amount and the compound interest on ` 25000 for 3 years at
12% per annum, compounded annually.
Explanation
Principal for the first year = ` 25000.

25000 ≥12 ≥1
Interest for the first year =` = ` 3000.
100
Amount after one year = ` 25000 + ` 3000 = ` 28000.
Principal for the second year = ` 28000.
node05\B0B0-BA\CBSE\9th\ICSE Part-1\Maths-1\03_Compound Interest.p65

28000 ≥12 ≥1
Interest for the second year =` = ` 3360.
100
Amount after 2 years = ` 28000 + ` 3360
= ` 31360.
Principal for the third year = ` 31360.

31360 ≥12 ≥1
Interest for the third year =` ` 3763.20
100
Amount after 3 years = ` 31360 + ` 3763.20
= ` 35123.20
Compound interest for 3 years = final amount – (original) principal
= ` 35123.20 – ` 25000
= ` 10123.20

46
 Mathematics
ALLEN
NUMERICAL ABILITY 3.1
Find the compound interest to the nearest rupee on ` 7500 for 2 years
4 months at 12% per annum reckoned annually.
Solution
Principal for the first year = ` 7500.

7500 ≥12 ≥1
Interest for the first year =` = ` 900.
100

Amount after one year = ` 7500 + ` 900 = ` 8400.

Principal for the second year = 8400.

8400 ≥12 ≥1
Interest for the second year = = ` 1008.
100
Amount after 2 years = ` 8400 + ` 1008 = ` 9408.

4 1
Remaining time = 4 months = year = year..
12 3

1
Principal for the next year = ` 9408.
3

1
1 9408 ≥12 ≥
Interest for the next year =` 3 = `376.32
3 100
Amount after 2 years 4 months = ` 9408 + ` 376.32
= ` 9784.32
\ Compound interest for 2 years 4 months
= final amount – original principal
= ` 9784.32 – `7500 = `2284.32
= ` 2284 (to the nearest rupee).

NUMERICAL ABILITY 3.2

1
Find the amount and the compound interest on `16000 for 1 years at
2
10% per annum, the interest being compounded half-yearly.
Solution
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Since the rate of interest is 10% per annum, therefore, the rate of interest
1
half-yearly = of 10% = 5%.
2
Principal for the first half-year = ` 16000.

16000 ≥ 5 ≥1
Interest for the first half-year =` = ` 800.
100
Amount after the first half-year = ` 16000 + ` 800 = ` 16800.
Principal for the second half-year = ` 16800.

16800 ≥ 5 ≥1
Interest for the second half-year =` = ` 840.
100
47
ICSE : Class IX
ALLEN
Amount after one year = ` 16800 + ` 840 = ` 17640.
Principal for the third half-year = ` 17640.

17640 ≥ 5 ≥1
Interest for the third half-year =` = ` 882.
100

1
Amount after 1 years = ` 17640 + ` 882 = ` 18522.
2

1
\ Compound interest for 1 yr.. = final amount – original principal
2
= ` 18522 – ` 16000 = ` 2522.

NUMERICAL ABILITY 3.3

Calculate the amount due and the compound interest on ` 37500 for 2
years when the rate of interest on successive years is 8% and 9%
respectively.
Solution
Principal for the first year = ` 37500, rate = 8% p.a.

37500 ≥ 8 ≥1
THE Interest for the first year =` = ` 3000.
SPOT P Amount after one year
100
= ` 37500 + ` 3000 = ` 40500.
LIGHT
Principal for the second year = ` 40500, rate = 9% p.a.
The compound interest may also be
obtained by adding together the 40500 ≥ 9 ≥1
interest of consecutive years. Interest for the second year =` = ` 3645
100
i.e.
Compound interest = interest of first Amount due after 2 years = ` 40500 + ` 3645 = ` 44145.
year + interest of second year. Compound interest for 2 years = final amount – original principal
= ` 44145 – ` 37500 = ` 6645.

BUILDING CONCEPTS 3.2

Calculate the interest earned and the amount due if a sum of `12500 is
invested for 1 year at 12% per annum, interest being compounded semi-
annually.
Explanation
Since the rate of interest is 12% per annum, therefore, the rate of interest
1
per conversion period (half-yearly) = of 12% = 6%.
2
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As the money is invested for 1 year, therefore,

n(the number of conversion periods) = 2.
Here, P = ` 12500, r = 6 and n = 2.
æ r ö÷
n

Using the formula, A = P ççç1 ∗ ÷ , we get

è 100 ø÷

æ 6 ÷ö æ106 ö÷
2 2

A = ` 12500 ççç1 ∗ ÷÷ = `12500 × çç ÷

çè100 ø÷
è 100 ø

æ 53 53 ö÷
= ` ççç12500 ≥ ≥ ÷÷ = ` 14045.
è 50 50 ø
\ ` C.I. = A – P = ` 14045 – `12500 = ` 1545.

48
 Mathematics
ALLEN
NUMERICAL ABILITY 3.4
Find the amount and the compound interest on ` 24000 at 10% per annum
1
for 1 years, compound interest reckoned half-yearly.
2
Solution
Since the rate of interest is 10% per annum, therefore, the rate of interest
1
per conversion period (half-yearly) = of 10% = 5%.
2

1
As the money is invested for 1 year, therefore,
2
n(the number of conversion periods) = 3
Here, P = ` 24000, r = 5 and n = 3.

æ r ö÷
n
Using the formula, A < P çç1 ∗ ÷÷ , we get
çè 100 ø

æ 5 ÷ö æ 21 ö
3 3

A = ` 24000 ççç1 ∗ ÷÷ = ` 24000 × çç ÷÷÷

è 100 ø çè 20 ø

THE
æ 21 21 21 ö÷
= ` ççç24000 ≥ ≥ ≥ ÷÷ = ` 27783.
è 20 20 20 ø
SPOT P
LIGHT
\ C.I. = A – P = `27783 – `24000 = `3783. If a principal P becomes ‘n’ times of
itself in T years at R% rate per-annum,
NUMERICAL ABILITY 3.5 then RT = (n – 1) ´ 100

Find the rate of compound interest on ` 4,000 so that it can amount to

` 4,410 in 2 years.
Solution
Here, P = ` 4,000, A = ` 4,410, n = 2, r = ?

æ r ö÷
n
From A = P çç1 ∗ ÷÷ , we get
çè 100 ø

æ r ö÷ æ r ÷ö
2 2
node05\B0B0-BA\CBSE\9th\ICSE Part-1\Maths-1\03_Compound Interest.p65

4410
4410 = 4000 × ççç1 ∗ ÷ Þ çç1 ∗
÷ ç
÷ <
÷
è 100 ø è 100 ø 400

æ ö æ ö
2 2 2

Þ çç1 ∗ r ÷÷ < 441 < 21 < çç 21 ÷÷ .

çè ÷
100 ø 400 20 2
èç 20 ø÷

r 21 r 21 1
[ 1∗ < Þ < ,1 < .
100 21 100 20 20

100
[ r< < 5.
20
\ the rate of compound interest = 5% per annum.

49
ICSE : Class IX
ALLEN
NUMERICAL ABILITY 3.6
In how many years will a sum of ` 5,000 become ` 6,655 at the compound
interest rate of 10% per annum ?
Solution
Here, P = ` 5000, A = ` 6655, r = 10, n=?
æ r ö÷
n

From A = P ççç1 ∗ ÷÷ , we get

è 100 ø
æ 10 ö÷ 6655 æç 1ö æ11 ö
n n n

` 6655 = ` 5000 × ççç1 ∗ ÷ Þ < ç1 ∗ ÷÷ < çç ÷÷

è 100 ø÷ 5000 èç ÷
10 ø èç10 ø÷
æ 11 ö÷ 11≥ 605 11≥121 11≥112 æç11 ö÷
n 3

Þ ççç ÷÷ < < < <ç ÷ .

è10 ø 5 ≥100 103 103 èç10 ø÷
\ n = 3.
\ the required number of years is 2.
NUMERICAL ABILITY 3.7
Raju lends ` 10,000 to John at the simple interest rate of 10% for 2 years
and ` 10,000 to Rahim at the compound interest rate of 10% for 2 years.
Find the sum of money that John and Rahim will return to Raju after
2 years to repay the loan. Who will pay more and by how much ?
THE
SPOT P Solution
For John
LIGHT P = ` 10000, R = 10, T = 2.
Growth and depreciation P≥R≥T 1000 ≥10 ≥ 2
\ interest = I = < < 2000.
Growth Rate : The growth rate for a 100 100
certain period is the ratio of the \ amount A = P + I = ` 10000 + ` 2000 = ` 12000.
change in that period and the mag- \ John will repay ` 12,000 to Raju after 2 years.
nitude just before this period, which
is expressed as percent.
For Rahim
P = Final value after n years. P = ` 10000, r = 10, n = 2.
Then rate of growth
æ ö
n
From A < P çç1 ∗ r ÷÷ , we get
Final value – Initial value èç ÷
100 ø
= × 100%
æ 10 ö÷ æ 11 ö
Initial value 2 2

A = ` 10000 × ççç1 ∗ ÷÷ = ` 10000 × çç ÷÷÷ = ` 100 × 121

P – P0 è 100 ø çè10 ø
or R = × 100% = ` 12100.
P0
\ Rahim will repay ` 12,100.
Now, ` 12100 > ` 12000, so, Rahim will pay more. He will pay
` 12100 – ` 12000, i.e., ` 100 more than John.
NUMERICAL ABILITY 3.8
The difference between CI and SI for 3 years @ 20% p.a. is ` 152. What is
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the principal lent in each case?

Solution
Difference between CI and SI for 3 years = ` 152
2
æ R ö æ R ö
Pç ÷ ç + 3 ÷ = 152
è 100 ø è 100 ø
æ 1 öæ 16 ö
P ç ÷ç ÷ = 152
è 25 øè 5 ø
152 ´ 25 ´ 5
P=
16
P = 9.5 ´ 25 ´ 5 = 1187.5

50
 Mathematics
ALLEN
EXERCISE # 1
Multiple choice questions 9. Sam invested ` 15,000 @ 10% per annum for one
year. If the interest is compounded half-yearly, then
1 the amount received by Sam at the end of the year
1. At the rate of 8 % p.a. simple interest, a sum of
2 will be :
` 4800 will earn how much interest in 12 years (1) ` 16,500 (2) ` 16,525.50
3 months ? (3) ` 16,537.50 (4) None of these
(1) ` 198 (2) ` 4989 10. What is the difference between the compound
(3) ` 4998 (4) ` 4900 1
interests on ` 5000 for 1 years at 4% per annum
2. The simple interest on ` 1820 from March 9, 2003 2
compounded yearly and half-yearly?
1 (1) ` 6.04 (2) ` 3.06
to May 21, 2003 at 7 % rate will be :
2 (3) ` 4.80 (4) ` 8.30
(1) ` 22.50 (2) ` 27.30 11. The difference between simple interest and
(3) ` 28.80 (4) ` 29 compound interest on ` 1200 for one year at 10%
3. A person borrows ` 5000 for 2 years at 4% p.a. per annum reckoned half-yearly is :
simple interest. He immediately lends it to another (1) ` 2.50 (2) ` 3
(3) ` 3.75 (4) None of these
1
person at 6 % p.a. for 2 years. Find his gain in 12. At what rate of compound interest per annum will
4 a sum of ` 1200 become ` 1348.32 in 2 years?
the transaction per year. (1) 6% (2) 6.5% (3) 7% (4) 7.5%
(1) ` 112.50 (2) ` 125 13. In how many years will a sum of ` 800 at 10% per
(3) ` 150 (4) ` 167.50 annum compounded semiannually become
4. In how many years, ` 150 will produce the same interest ` 926.10 ?
1 1 1 1
1 (1) 1 (2) 1 (3) 2 (4) 2
@ 8% as ` 800 produce in 3 years @ 4 %? 3 2 3 2
2 14. The difference between compound interest and
(1) 6 (2) 8 (3) 9 (4) 12 simple interest on an amount of ` 15,000 for
5. The simple interest on ` 10 for 4 months at the 2 years is ` 96. What is the rate of interest per
rate of 3 paise per rupee per month is : annum ?
(1) ` 1.20 (2) ` 1.60 (1) 8 (2) 10
(3) ` 2.40 (4) ` 3.60 (3) 12 (4) None of these
6. If a sum of money at simple interest doubles in 15. The difference between compound interest and
6 years, it will become 4 times in : simple interest on a sum for 2 years at 10% per
(1) 12 years (2) 14 years annum, when the interest is compounded annually
(3) 16 years (4) 18 years is ` 16. If the interest were compounded half-yearly,
7. In how much time would the simple interest on a
the difference in two interests would be :
certain sum be 0.125 times the principal at 10%
per annum? (1) ` 24.81 (2) ` 26.90
node05\B0B0-BA\CBSE\9th\ICSE Part-1\Maths-1\03_Compound Interest.p65

1 3 (3) ` 31.61 (4) ` 32.40

(1) 1 year (2) 1 year 16. On a sum of money, the simple interest for 2 years
4 4
1 3 is ` 660, while the compound interest is ` 696.30,
(3) 2 year (4) 2 year the rate of interest being the same in both the cases.
4 4
The rate of interest is :
3
8. A simple interest rate of 4
per annum, how much (1) 10% (2) 10.5%
4
time is needed for ` 432 to yield an interest of (3) 12% (4) None of these
` 78.66? 17. A sum of ` 12,000 deposited at compound interest
(1) 2 years 10 months becomes double after 5 years. After 20 years, it
(2) 3 years will become :
(3) 3 years and 10 months (1) ` 96,000 (2) ` 1,20,000
(4) 4 years (3) ` 1,24,000 (4) ` 1,92,000

51
ICSE : Class IX
ALLEN
18. If a sum on compound interest becomes three times 24. At what rate percent per annum at compound
in 4 years, then with the same interest rate, the interest will the sum of ` 375 amount to ` 1029
sum will become 27 times in : in 3 years?
(1) 8 years (2) 12 years (1) 20 (2) 30 (3) 25 (4) 40
(3) 24 years (4) 36 years 25. In how many years will a sum of ` 3200 compounded
19. A sum of money invested at compound interest quarterly at the rate of 50% p.a. amount to ` 4050 ?
becomes ` 1020 after 3 years and ` 1088 after 4 (1) one year (2) half year
years. The rate of interest is (3) two years (4) 3 years
(1) 5.60% (2) 6.66% (3) 7.66% (4) 8.66% 26. The difference between the compound interest and
20. If the compound interest on a certain sum of money the simple interest on a certain sum of money for
for 2 years is ` 2700 and the simple interest on the 2 years at 11% per annum is ` 363. Find the sum.
same sum for the same period and for same interest (1) ` 33000 (2) ` 31000
is 1250, then rate %. (3) ` 30000 (4) ` 32000
(1) 16 percent (2) 10 percent 27. Raju invested a sum of ` 5832 at a rate of interest
(3) 18 percent (4) 24 percent n% per annum, compounded annually. Find the
21. A sum of money becomes ` 6500 after 3 years value of n, if he received a sum of ` 13824 after
and ` 10562.50 after 6 years on compound 3 years.
interest. The sum is 1 2 4
5
(1) ` 4000 (2) ` 4500 (1) 33 (2) 33 (3) 33 (4) 33
3 3 3 3
(3) ` 4800 (4) None of these 28. A sum of ` 2500 is invested for 2 years at 20% per
annum, interest compounded half-yearly. Find the
4
22. The simple interest on a sum of money is times compound interest.
9 (1) ` 3660.25 (2) ` 1660.25
the principal and the rate of interest per annum is (3) ` 1160.25 (4) ` 1330
numerically equal to the number of years. Find the 29. Find the compound interest on ` 50000 for 3 years,
compounded annually and the rate of interest being
rate of interest per annum.
10%, 12% and 15% for the three successive years
10 15 respectively.
(1) % (2) %
3 3 (1) ` 20840 (2) ` 70840
20 15 (3) ` 60720 (4) ` 67560
(3) % (4) %
3 2 30. The rate of interest for a sum that becomes
23. At what rate of simple interest per annum, does the
729
interest on ` 1200 in 2 years equal the interest on times itself in 2 years, when compound
576
7
` 600 at 4 years at % p.a. ? annually is
2
32 12 25 12
3 7 4 7 (1) % (2) % (3) % (4) %
(1) % (2) % (3) % (4) % 5 5 2 7
4 2 3 8
node05\B0B0-BA\CBSE\9th\ICSE Part-1\Maths-1\03_Compound Interest.p65

EXERCISE # 1 ANSWER KEY

Multiple choice questions

Que. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Ans. 3 2 1 3 1 4 1 3 3 1 2 1 2 1 1
Que. 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Ans. 4 4 2 2 1 1 3 2 2 2 3 1 3 3 1

52
 Mathematics
ALLEN
EXERCISE # 2
Very short answer type questions 9. Calculate the amount and the compound interest
1. Find the compound interest and amount on on `20000 in 3 when the rate of interest for the
(i) ` 9,600 for 3 years at the interest rate of successive years is 10%, 10% and 12% per annum
10% per annum. respectively.
(ii) ` 8,000 for 3 years at the interest rate of 10. Rohit invests `15625 for three years at a certain
5% per annum. rate of interest, compounded annually. At the end
of one year, it amounts to `16875. Calculate :
1
2. A sum of ` 30,000 is invested for 3 years at 7 % (i) the rate of interest per annum.
2
p.a. compound interest. (ii) the interest accrued in the second year.
(i) What is the sum at the end of the second years? (iii) the amount due to him at the end of third year.
(ii) What is the sum at the end of the 3 years ? (iv) the interest earned in the third year.
(iii) What is the total interest earned in 3 years ? (v) the interest earned in 3 years.
3. A sum of ` 8,000 becomes ` 8,800 in one year at 11. Find the amount and the compound interest on
a certain rate of interest per annum. `12000 for 2 years at 7.5% per annum, interest
(i) Find the compound interest on the sum for reckoned yearly.
2 years at the same rate of interest. 12. Swati took a loan of ` 16000 from State bank of
(ii) Find the amount after 3 years at the same rate India for 3 years at the rate of 12.5% per annum,
of compound interest. compounded annually. Find the amount and the
compound interest she has to pay at the end of 3
4. Ms patel invests ` 80,000 at a compound interest
years to clear her debt, to the nearest rupee.
rate of 10% p.a. for 2 years while Ms kapoor invests
13. If the interest is compounded half-yearly, calculate
` 1,00,000 at a compound interest rate of 8% for
the amount and the compound interest when the
3 years. Who will earn more and by how much ?
principal is ` 3750, the rate of interest is 8% and
5. Mr Roy took a loan of ` 1,00,000 from a
the duration is one year.
moneylender at the compound interest rare of
14. Find the amount and the compound interest on
1
12 % p.a. he repaid the money at the end of two
2 1
years. `8000 at 10% per annum for 1 years, compound
2
(i) Find the interest paid by Mr Roy to the interest reckoned semi-annually.
moneylender. 15. Find the difference between compound interest and
(ii) How much did Mr Roy pay to clear the debt ? simple interest on ` 5000 for 2 years at 8% per
Short answer type questions annum payable yearly.
6. A man invested ` 40,000 for 3 years at the 16. Vikram invests `14000 for 3 years at the rate of
compound interest rate of 8% p.a. After 2 years 10% per annum, interest reckoned yearly.
the rate of interest was raised to 10% Calculate:
(i) Find the total interest earned by him. (i) the sum due to Vikarm at the end of first year.
node05\B0B0-BA\CBSE\9th\ICSE Part-1\Maths-1\03_Compound Interest.p65

(ii) Find the amount he received after 3 years. (ii) the interest he earns for the seond year.
7. A sum of ` 16000 is invested for three years at 10%
(iii) the amount due to him at the end of three years.
per annum interest compounded annually.
(iv) the interest he earns in 3 years.
(i) What is the sum due at the end of first year ?
(ii) What is the sum due at the end of second year ? (v) the interest he earns for the third year.
(iii) What is the compound interest earned in 2 years? 17. The simple interest on a certain sum of money for
2 years at 5% is ` 1600. Find the amount due and
(iv) What is the interest earned in the second year ?
the compound interest at the same rate after 3 years,
(v) What is the sum due at the end of three years ?
interest compounded annually.
8. Find the amount and the compound interest on
18. Jacob invests ` 25000 for 3 years at 8% per annum,
1
`40000 for 1 years at 10% per annum, the interest compound annually. Find the amount and
2
the compound interest due to him after 3 years.
interst being compounded semi annually

53
ICSE : Class IX
ALLEN
19. ` 20000 was lent for one year at 12% per annum. (i) the rate of interest per annum.
By how much more will the interest be if the sum (ii) the amount at the end of second year.
was lent at 12% per annum, interest being
(iii) the compound interest earned in 2 years.
compounded half-yearly.
25. The simple interest on a certain sum of money for
20. Find the amount and the compound interest on
2 years at 10% per annum is `4000. Find the
1 amount due and the compound interest on this sum
`37500 at 8% per annum for 1 years, interest
2 of money at the same rate after 3 years, the interest
compounded half-yearly.
being compounded annually.
Long answer type questions
26. A man invested ` 30,000 for 2 years at the
21. Suraj invests ` 46875 in State Bank of India at 8%
compound interest rate of 7.5% p.a. At the end of
per annum compound interest for 3 years.
the first year the rate of interest was raised to 8%
Calculate: p.a. Find the sum the man received after 2 years.
(i) the interest for the first year.
27. A sum of money becomes 2.25 times in 2 years at
(ii) the amount standing to his credit at the end of a certain rate of compound interest per annum. Find
second year.
the rate of interest.
(iii) the interest for the third year.
28. A sum of money is invested for 3 years at a rate of
(iv) the amount due to him at the end of third year.
10% interest compounded annually. If the sum of
22. To renovate his shop, Mohanti borrowed `50000 money grows by ` 5296 then find the sum of money
from Bank of Baroda for 3 years at the rate of 12% invested ?
per annum, compounded annally. What amount will
29. How much should Ratan invest in an agency which
he pay to the bank to clear his debt after 3 years ?
pays interest at the rate of 9% compounded annually
23. Calculate the amount and the compound interest
to get an amount of ` 71,286 in 2 years ?
on `15000 in 2 years when the rate of interest for
30. Mr Das invested ` 20,000 at a simple interest rate
the successive years is 8% and 9% per annum
of 10% per annum for 3 years while Mr Sinha
respectively.
invested the same sum at the compound interest
24. A man invests `12000 for two years at a certain
rate of 15% for 2 years. Who will earn more interest
rate of interest, compounded annually. At the end
and by how much ?
of one year, it amounts to `13200. Calculate:

EXERCISE # 2 ANSWER KEY

Very short answer type questions
1. (i) ` 3177.6, ` 12777.6, (ii) ` 1261, ` 9261 2. ` 34668.75, (ii) ` 37268.90, (iii) ` 7268.90

3. ` 1680, (ii) ` 10,648 4. ` 29171.20 5. 50%

Short answer type questions

6. ` 102.40 7. ` 17600, (ii) ` 19360, (iii) ` 3360, (iv) ` 1760, (v) ` 21296 8. ` 46305, ` 6305
node05\B0B0-BA\CBSE\9th\ICSE Part-1\Maths-1\03_Compound Interest.p65

9. ` 27104, ` 7104 10. (i) 8%, (ii) ` 1350, (iii) ` 19683, (iv) ` 1458, (v) ` 4058

11. ` 13867.50, ` 1867.50 12. ` 22781, ` 6781 13. ` 4056, ` 306

14. ` 9261, ` 1261 15. ` 32

16. (i) ` 15400, (ii) ` 1540, (iii) ` 18634, (iv) ` 4634, (v) ` 1694 17. ` 18522, ` 2522

18. ` 31492.8, ` 6492.8 19. ` 72 20. ` 72182.40, ` 4682.40

Long answer type questions

21. (i) ` 3750, (ii) ` 54675, (iii) ` 4374, (iv) ` 9049 22. ` 70246.40 23. ` 17658, ` 2658

24. (i) 10%, (ii) ` 14520, (iii) ` 2520 25. `26620, ` 6620 26. `34,830

27. 50% 28. ` 16,000 29. 50% 30. Mr. Sinha, ` 450

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