What is the compound interest on a sum of ₹12,000 for $2\frac{5}{8}$ years at 8% p.a., when the interest is compounded annually? (nearest to a rupee)

₹2,697

Interest for the  first 2 years = 8%

and Interest for last \(\frac{5 }{8}\) year = \(\frac{5 }{8}\) × 8% =5%

So ,

                               Principal   :   Amount

For 1st year                   25      :      27

For 2nd year                   25      :      27

For 3rd year                    20      :      21

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overall                      12500       :     15309

ATQ,

12500R = 12000

1R = 0.96

CI = ( 15309 - 12500 )R = 2809R

= 2809 × 0.96

= 2696.64

= 2697   ( approx )