Find the compound interest (CI) on ₦15,700 for 2 years at 8% per annum compounded annually.
A.
₦6,212.48
B.
₦2,834.48
C.
₦18,312.48
D.
₦2,612.48
Correct answer is D
Principal (P) = ₦15,700
Rate (R) = 8
Number of years (t) = 2
A = P \((1+\frac{R}{100})^t\)
⇒ A = 15700 \((1+\frac{8}{100})^2\)
⇒ A = 15700 (1 + 0.08)\(^2\)
⇒ A = 15700 (1.08)\(^2\)
⇒ A = 15700 x 1.1664
⇒ A = ₦18,312.48
Total amount, A = ₦18,312.48
A = P + CI
⇒ CI = A - P
⇒ CI = 18,312.48 - 15,700
∴ CI = ₦2,612.48
