Math Problem Statement

My capital is Rs. 15,45,63,405. If I earn 10% interest every month, what will be my capital after 1 year if I compound every month

Solution

To calculate your capital after 1 year with a 10% monthly interest rate, compounded monthly, we'll use the compound interest formula again:

A=P×(1+rn)n×tA = P \times \left(1 + \frac{r}{n}\right)^{n \times t}

Where:

  • P=15,45,63,405P = 15,45,63,405 (initial capital in Rs)
  • r=0.10×12=1.2r = 0.10 \times 12 = 1.2 (annual interest rate)
  • n=12n = 12 (compounded monthly)
  • t=1t = 1 year

Let's calculate the final amount AA.After 1 year, with a 10% monthly interest rate compounded monthly, your capital will be approximately Rs. 48,50,86,176.

Would you like more details or have any questions about this calculation?

Here are some related questions:

  1. What would your capital be after 6 months with this new capital amount?
  2. How much interest would you earn in the first month alone?
  3. What would be the total interest earned after 1 year?
  4. How would your capital change if the interest rate was compounded daily instead of monthly?
  5. What would be your capital after 2 years under the same conditions?

Tip: The power of compounding is significant, especially with high monthly interest rates. It's essential to understand how it scales over time.

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Math Problem Analysis

Mathematical Concepts

Compound Interest
Exponential Growth

Formulas

Compound Interest Formula

Theorems

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Suitable Grade Level

Grades 9-12