What would would be the C.I. obtained on an amount of Rs. 4860 at the rate of 5 p.c.p.a. for 3 years

Options

A. Rs. 748.05
B. Rs. 817.08
C. Rs. 723.5
D. Rs. 766.05

Answer

To find the Compound Interest (C.I.) on an amount of Rs. 4860 at the rate of 5% per annum for 3 years, we can follow these steps:

### Step 1: Identify the formula for Compound Interest
The formula for the amount (A) in Compound Interest is given by:
\[ A = P \left(1 + \frac{r}{100}\right)^t \]
where:
- \( P \) = Principal amount (initial investment)
- \( r \) = Rate of interest (per annum)
- \( t \) = Time (in years)

### Step 2: Substitute the known values into the formula
Here, we have:
- \( P = 4860 \)
- \( r = 5 \)
- \( t = 3 \)

Substituting these values into the formula:
\[ A = 4860 \left(1 + \frac{5}{100}\right)^3 \]

### Step 3: Simplify the expression inside the parentheses
Calculating \( \frac{5}{100} \):
\[ \frac{5}{100} = 0.05 \]
So, we can rewrite the equation as:
\[ A = 4860 \left(1 + 0.05\right)^3 \]
\[ A = 4860 \left(1.05\right)^3 \]

### Step 4: Calculate \( (1.05)^3 \)
Now we need to calculate \( (1.05)^3 \):
\[ (1.05)^3 = 1.157625 \]

### Step 5: Calculate the total amount (A)
Now, substituting this value back into the equation:
\[ A = 4860 \times 1.157625 \]
Calculating this gives:
\[ A \approx 5625.05 \]

### Step 6: Calculate the Compound Interest (C.I.)
The Compound Interest can be calculated using the formula:
\[ C.I. = A - P \]
Substituting the values we have:
\[ C.I. = 5625.05 - 4860 \]
\[ C.I. \approx 765.05 \]

### Final Answer
Thus, the Compound Interest obtained is approximately Rs. 765.05.

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