A sum of ₹15,000 is invested at a simple interest rate of 8% per annum. What will be the total amount after 4 years, including the principal?
Question
A sum of ₹15,000 is invested at a simple interest rate of 8% per annum. What will be the total amount after 4 years, including the principal?
Solution
To calculate the total amount after 4 years including the principal, we need to first calculate the simple interest and then add it to the principal amount.
Step 1: Calculate the Simple Interest The formula for simple interest is I = PRT/100, where:
- P is the principal amount (₹15,000 in this case)
- R is the rate of interest (8% per annum in this case)
- T is the time period (4 years in this case)
So, I = (15000 * 8 * 4) / 100 = ₹4800
Step 2: Calculate the Total Amount The total amount is the sum of the principal and the interest. So, the total amount = Principal + Interest = ₹15000 + ₹4800 = ₹19800
So, the total amount after 4 years, including the principal, will be ₹19800.
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