➜
➜
➜
➜
➜
10000
=
[ 1 +
r
100
] 2
=
12100
[ 1 +
r
100
]2
=
12100
10000
[ 1 +
r
100
]2
=
121
100
[ 1 +
r
100
]
=
11
10
11² = 121
10² = 100
10² = 100
r
=
1
10
× 100
r
=
10%
Interest Compounded Annually
years
10000
2
12100
Compound Interest for 2 years at
the same rate of interest
the same rate of interest
=
12100
-
10000
=
2100
Simple Interest =
10000 × 10 × 2
100
=
2000