0 ratings0% found this document useful (0 votes) 10 views1 pageTheory of Compound Interest
Short note of COMPOUND INTEREST FOR COMPITITIVE EXAM
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COMPOUND INTEREST
Iperance: in examinations ofauierent evla | or
2queaonsofcompourd itseatarcesseeuay sen
they fer m deat level Quectians ar af ate
Varley and Nence, marks soay be ensured with
eepeanns
Scope of questions = Quesdons asked tn diferent
cxamiaatons are mama of two Opes eee ae
compound ieest only and based oh both of simple
inks and compound ueren Rate teers aoe
Yyeary hall yea ar quartet. EAM (Equal Mo
Ttaimenta bce qutsuons creates,
‘Way to saccene : Queslons cat be ood cay
leamlig bate concepts a orale leary aq
nd ciben of mntere wl wrease spend
RULE 1: If = Amount, P © Principal, r = Rate of
Compound Interest (CL. = no. of years then,
i
aetnt ye
ose
[RULE 2 : Compound interest is calculated on fourbasts:
eAP
Rae iy
Amal me Uyears
Hale year 5% Ue 2yeure
‘Serannualya
Ouanety 4 years
ont Ee. avn
RULE 3 : UF there are distinct ‘tates of interest’ for
distinct time pertods 1.
Rate for Ist year —> 6%
Rate for 2nd year —» 1, %
Rate for Grd year -> 1, % and so on,
roe aar( ede nel Bh)
Che A-P
RULE
Conk, then
it (ta eee
aae(tesis) (aS)
[RULES : Acertan sum becomes’m mes of tec int"
‘on compound Interest then the time fe will take to
come mi” ties of itself Is Cm years.
the Ume Is in fractional form Le.
s
35 yrs, then
RULE 6 : The dllferenice between C1. and SL on a
sum ‘Pin 2 years al the rate of Roe rate of compaund
interest will be
aaa
00.
ex-sus e +8
RY fy,
rorsyean o1-sner(-ZY fa)
027 ansonpnd mse sms coo TA
wos yan a
Witb-a
3
~(2}
un (8-100
5
sons-n-aeu ne (fE-s}uom
Byr
wi sramme|fom
where n toa whole number,
RULE & : Ifa sum becomes 1’ umes of tselfin € years.
a
RULE 9 : Ifa sum ‘PIs borrowed at 1% annual
‘compound imerest which ts to be pasd itn’ equal anna.
‘installments including interest then
(i) forn=2, Each annual thstallment
e
} sat)
a
innrgpa ney
:
oy
(2) ee) Gee
RULE 10 : The simple interest for a certain sum for 2 i
years at an annual rate interest RM le S.1.. then
:
anal
RULE 11 : Acertain sum at C.. becomes x tines inn,
is
persndyternn pent fe |
cag
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