Answer:
Compound interest amount=3,500 rupees
Step-by-step explanation:
The compound interest amount after a given number of years can be represented by the formula below;
Compound interest amount =A-P
where;
A=P(1+r/n)^nt=Future value of investment or loan
P=Initial value of investment or loan
r=Annual interest rate
n=Number of periods per unit time, t
t=Number of years the investment is compounded
In our case;
A=8,500
P=5,000
replacing;
Compound Interest=Total compounded amount after 3 years-Initial amount
Compound interest=(8,500-5,000)=3,500
Compound interest amount=3,500 rupees
