What is the compound interest on a sum of 8000 at the rate of 5% per annum compounded quarterly for 3 months?

₹100

Interest is compounded quarterly.

So, Actual rate of interest = \(\frac{5}{4}\)%

From the formula for compound interest, we know,

C.I = P(1+$\frac{R}{100})^t$– P

= 8000 [ 1 + \(\frac{5}{400}\) ] - 8000

= 8000 [ \(\frac{81}{80}\) ] - 8000

= 8100 - 8000

= Rs. 100