Question

Laxmi borrowed Rs 3200 on compound interest to her friend at 5% per annum for a time period of one year then find the compound Interest paid by Laxmi 
1. Rs 160
2. Rs 200
3. Rs 180
4. Rs 130
5. None of these 

Answer 1

Correct Answer - Option 1 : Rs 160

Given:

Laxmi borrowed  = 3200

Rate of interest = 5%

Time = 1 year

Formula:

A = P(1+ R/100)ⁿ

Calculation:

A = P(1+ R/100)ⁿ

⇒ 3200 [1 + (5/100)]

⇒ 3200 × (21/20)

⇒ 3360

CI = A – P

⇒ 3360 – 3200

⇒ 160 Rs.

∴ CI for given sum is Rs. 160