Compound Interest (Without Using Formula) — Important Questions

CI for first year equals SI for first year, CI increases each year on same principal, CI is always greater than SI after first year

In CI, first year interest equals SI. Each year's interest is calculated on growing amount, so CI increases yearly and exceeds SI after year 1.

10%

Let rate = r%. Year 1: CI = 10000r/100. Year 2: CI = (10000+10000r/100)×r/100. Total CI = 10000r/100 + (10000r + 100r²)/10000 = 2100. Solving: r = 10%

Interest for year 1 on original principal, Interest for year 2 on year 1 amount, Interest for year 3 on year 2 amount, Sum of all yearly interests

CI calculation requires computing interest each year on the growing principal (amount from previous year), then summing all yearly interests.

₹19,320

Year 1: Interest = (15000×12)/100 = ₹1,800, Amount = ₹16,800. Year 2: Interest = (16800×15)/100 = ₹2,520, Amount = 16800 + 2520 = ₹19,320