Word Problem 7
Problem 7: The rate of compound interest for Rs 1000 for the first year is 5% pa, and for the second year it is 6% pa. What will be the amount of interest after 2 years?
simple arithmetic questions and answers
There are two terms of interest calculation. For first term rate of interest is 5 and for second terms it is 6. While principal amount 1000 Rs is for 1st term, and for second term the principal amount will be 1000+Interest of first term !
Principal Amount = P = 1000 Rs
Rate of Interest = R= 5 % per annum
Term of Interest Implication = T= 1 Year
We know that,
Now, amount of first case A=1050 Rs will be principal amount for second term
Principal amount P=1050
Term =T= 1 year
Rate of interest R= 6% pa
So total amount of interest ;