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Question:

Maria invested Rs 8,000 in a business. She would be paid interest at 5%

Solution:

i) A = P(1 + r/100)^n = 8000(1 + 5/100)^2 = 8000(1.1025) = 8820
Amount at the end of 2 years = Rs. 8,820
ii) A = P(1 + r/100)^n = 8000(1 + 5/100)^3 = 8000(1.157625) = 9261
Amount at the end of 3 years = Rs. 9261
So, the interest for the 3rd year = Rs. 9261 - Rs. 8820 = Rs. 441