Find the compound interest on 10000 at 10% per annum for 3 years, compounded annually.

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1331

3310

3130

13310

answer is B.

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Detailed Solution

Given:
Present value =10000
Interest rate =10% per annum
Time =3 years
To find the amount we have the formula,

{A = P}_{} (1 + \frac{R}{100})^{n}

Where P is present value, r is rate of interest, n is time in years.
Now substituting the values in above formula we get,

{A = 10000}_{} (1 + \frac{10}{100})^{3}

\Rightarrow {A = 10000}_{} (\frac{11}{10})^{3}

\Rightarrow {A =}_{} 121 \times 10 \times 11

\Rightarrow {A =}_{} 1331 \times 10

\Rightarrow A = 13310

Compound interest

= A - P

\Rightarrow 13310 - 10000

\Rightarrow 13310

Therefore, the compound interest is Rs 13310.
Hence, the correct option is (2) .

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