The simple interest on a sum of money for 3 years at an interest rate of 6% p.a. is Rs.6,750. What will be the compound interest rounded off on the same sum at the same rate for the same period, compounded annually is closest to :

Rs. 7,163

We know ,

Simple Interest = \(\frac{P×R×T }{100}\)

6750 = \(\frac{P×6×3 }{100}\)

Principal = 37500 

Now ,

Compound interest = Principal × ( 1 + \(\frac{rate }{100}\) )^t - Principal

= 37500 × ( 1 + \(\frac{6 }{100}\) )³ - 37500

= 37500 × ( \(\frac{106 }{100}\) )³ - 37500 

= 7163.1

= Rs. 7163  ( approx)