An amount of 8400 is borrowed for 2 years at 5% per annum. Find thecom

1.	An amount of 8400 is borrowed for 2 years at 5% per annum. Find thecompound interest and the amount, when the interest is compounded annually.
Answer» Answer: Amount to be returned at the end of 2nd year = 9261 Compounded interest = 861 Step-by-step explanation: GIVEN, $P_{1}$ = 8400 R = 5% T = 2 SI for the first year = 84005 1/100 = 420 = $SI_{1}$ The PRINCIPLE for year 2 becomes 8400 + 420 = 8820 = $P_{2}$ SI for the second year = 8820 * 5 * 1/100 = 441 = $SI_{2}$ Amount to be returned at the end of 2nd year = $P_{2}$ + $SI_{2}$ = 8820 + 441 = 9261 Total interest given = $S_{1} + S_{2}$ = 420 + 441 = 861 Hence, Amount to be returned at the end of 2nd year = 9261 Compounded interest = 861 Hope it helps..