What will be the compound interest on rupees 200 for 2 years at 10 per annum
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Compound Interest: The future value (FV) of an investment of present value (PV) dollars earning interest at an annual rate of r compounded m times per year for a period of t years is: Show
where i = r/m is the interest per compounding period and n = mt is the number of compounding periods. One may solve for the present value PV to obtain: PV = FV/(1 + r/m)mtNumerical Example: For 4-year investment of $20,000 earning 8.5% per year, with interest re-invested each month, the future value is FV = PV(1 + r/m)mt = 20,000(1 + 0.085/12)(12)(4) = $28,065.30Notice that the interest earned is $28,065.30 - $20,000 = $8,065.30 -- considerably more than the corresponding simple interest. Effective Interest Rate: If money is invested at an annual rate r, compounded m times per year, the effective interest rate is: reff = (1 + r/m)m - 1.This is the interest rate that would give the same yield if compounded only once per year. In this context r is also called the nominal rate, and is often denoted as rnom. Numerical Example: A CD paying 9.8% compounded monthly has a nominal rate of rnom = 0.098, and an effective rate of: r eff =(1 + rnom /m)m = (1 + 0.098/12)12 - 1 = 0.1025.Thus, we get an effective interest rate of 10.25%, since the compounding makes the CD paying 9.8% compounded monthly really pay 10.25% interest over the course of the year. Mortgage Payments Components: Let where P = principal, r = interest rate per period, n = number of periods, k = number of payments, R = monthly payment, and D = debt balance after K payments, then R = P � r / [1 - (1 + r)-n] andD = P � (1 + r)k - R � [(1 + r)k - 1)/r] Accelerating Mortgage Payments Components: Suppose one decides to pay more than the monthly payment, the question is how many months will it take until the mortgage is paid off? The answer is, the rounded-up, where: n = log[x / (x � P � r)] / log (1 + r) where Log is the logarithm in any base, say 10, or e.Future Value (FV) of an Annuity Components: Ler where R = payment, r = rate of interest, and n = number of payments, then FV = [ R(1 + r)n - 1 ] / r Future Value for an Increasing Annuity: It is an increasing annuity is an investment that is earning interest, and into which regular payments of a fixed amount are made. Suppose one makes a payment of R at the end of each compounding period into an investment with a present value of PV, paying interest at an annual rate of r compounded m times per year, then the future value after t years will be FV = PV(1 + i)n + [ R ( (1 + i)n - 1 ) ] / iwhere i = r/m is the interest paid each period and n = m � t is the total number of periods.Numerical Example: You deposit $100 per month into an account that now contains $5,000 and earns 5% interest per year compounded monthly. After 10 years, the amount of money in the account is: FV = PV(1 + i)n + [ R(1 + i)n - 1 ] / i =5,000(1+0.05/12)120 + [100(1+0.05/12)120 - 1 ] / (0.05/12) = $23,763.28 Value of a Bond: Let N = number of year to maturity, I = the interest rate, D = the dividend, and F = the face-value at the end of N years, then the value of the bond is V, whereV = (D/i) + (F - D/i)/(1 + i)NV is the sum of the value of the dividends and the final payment. You may like to perform some sensitivity analysis for the "what-if" scenarios by entering different numerical value(s), to make your "good" strategic decision. MENU:Replace the existing numerical example, with your own case-information, and then click one the Calculate. Complete Mathematics For Cambridge IGCSE® Fifth Edition Extended PDF 91%(404)91% found this document useful (404 votes) 154K views504 pagesDocument Informationclick to expand document information
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Copyright © 2022 Scribd Inc. Home Books Audiobooks Documents What is the compound interest on rupees 2000 for 2 years at 10% rate per annum?∴ The compound interest on ₹2000 at 10% p.a. for 2 years, compounded annually, is Rs. 420.
What is the compound interest on Rs 2500 for 2 years at rate of interest 10% per annum?=3025−2500=Rs. 525. Q. Find the amount and the compound interest on Rs 2500 for 2 years at 10 per annum, compounded annually.
What is the compound interest on Rs 200 for one year at 10% compounded half yearly?Hence, Amount after 1 year is Rs. 220.5 and compound interest recieved is Rs. 20.5 .
What will be the compound interest on Rs 12600 for 2 years at 10% per annum compounded annually?Thus, the answer to the question, the Interest Compound CI is Rs 2,646.
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