Vikram borrowed rupees 2,000 from a bank at 10% per annum simple interest he lent it to his friend Venkat - Maths - Compound Interest

Question

Vikram borrowed rupees 2,000 from a bank at 10% per annum simple
interest he lent it to his friend Venkat at the same rate but
compounded annually find his gain after 2 and a 1/2 years

Bakul Biswas · Accepted Answer

Dear Student,
first find the total amount paid by vikram to bank after 2
5 years using simple interest formula,A=P+S
I
    =P+P×R×T100     =P1+R×T100      =20001+10×52×100       =20001+14        =2000×54         =Rs
2500now we will find the amount when P=2000 is lent at R=10% p
a  for 212 years compounded anually
first find the amount at the end of 2 yearsA1=P1+R100t      =20001+101002       =200011102         =Rs
2420now find the interest for the remaining 6 months or half year
interest=2420×10×1100×2=Rs
121thus amount received from venkat after 2
5 years isRs 2420+121=Rs
2541required gain amount=Rs 2541-2500=Rs 41
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Vikram borrowed rupees 2,000 from a bank at 10% per annum simple interest he lent it to his friend Venkat at the same rate but compounded annually find his gain after 2 and a 1/2 years