16. Ajit borrowed 2,00.000 from a credit card company at 20% p. a. compounded quarterly. Find the compound interest and the amount after one year.​

Given:

Principal value = 2,00,000

Rate of interest = 20% p.a. compounded quarterly.

To find:

The compound interest and the amount after one year.​

Solution:

Formula for amount is:

Where, P is principal, r is the rate of interest in decimal, n is the number of times interest compounded in an year and t is the number of years.

The interest is compounded quarterly. So, the value of n is 4.

Putting in the above formula.

Therefore, the amount after one year is 2,43,101.25.

We know that the compound interest is the difference between amount and principal value. So,

Therefore, the amount is 2,43,101.25 and the compound interest is 43,101.25.