# What would be the Compound Interest on Rs.3200 at 25 % per Annum for 3 Years?

- Rs. 2050
- Rs. 2775
- Rs. 3050
- Rs. 3180

**Answer: (3) Rs.3050**

**Explanation:-**

**Given –**

Principal = Rs.3200 , Rate = 25 % & Time = 3 years

**Formula-**

**Compound Interest = P [(1 + R/100) ^{t} – 1]**

**Where, P = principal, R = rate, t = time.**

Then,

Compound Interest = 3200 [(1 + 25/100)^{3} – 1]

= 3200[(1 + ¼)^{3} – 1]

= 3200 (5/4)^{3} – 3200

= 3200 x 5 x 5 x 5/ 4 x 4 x 4 – 3200

= 200 x 5 x 5 x 5/4 – 3200

= 50 x 5 x 5 x 5 – 3200

= 50 x 125 – 3200

= 6250 – 3200

= Rs.3050

Then, the simple Interest is Rs.3050.

Hence, the answer is (3) Rs.3050.