The amount of money in the account every year when Rs. 10000 is deposited at compound interest 8% per annum.

Question

In which of the following situations does the list of numbers involved arithmetic progression, and why?

The amount of money in the account every year when Rs. 10000 is deposited at compound interest 8% per annum.

Answer 1

Original Amount = Rs. 10,000

Interest earned in first year = 10,000 × 8%

= 10, 000 x 8/100

= Rs 800

Total amount outstanding after one year = Rs 10000 + 800

= Rs 10800

Now, interest earned in 2^nd year = 10800 x 8/100 = Rs. 864

Total amount outstanding after 2^nd year = Rs10800 + 864

= Rs 11664

Interest earned in 3^rd year = 11664 x 8/100

= Rs 933.12

Total amount outstanding after 3^rd year = Rs 11664 + 933.12

= Rs 12597.12

Therefore, the series is

10800, 11664, 12597.12,…

Difference between second and first term = 11664 – 10800

= 864

Difference between third and second term = 12597.12 – 11664

= 933.12

Since the difference is not same

Therefore, it doesn’t form an AP.