Given:
Principal = Rs. 2000
Rate of interest = 20% p.a. compounded quarterly.
Time = 1 year
To find:
The compound interest.
Solution:
Formula for amount:
where,
P = Principal
r = Rate of interest
t= Time
n = number of times interest compounded in an year.
Putting P=2000, r=0.2, n=4 and t=1, we get
Now, the compound interest is
Therefore, the compound interest is Rs 431.0125.
