Given: Principal = Rs. 1200 Rate of interest = 20% Time = 2 years Calculation: ⇒ Compound interest = amount received after 2 years – principal =1200(1+
20
100
)2−1200 = 1728 – 1200 = Rs. 528 Short Trick: Equivalent rate of interest for 2 years = 20 + 20 + (20 × 20) /100 = 44% ⇒ Required compound interest = (1200 × 44) /100 = Rs. 528