Solution

Present value$$= ₹ 2500$$

Interest rate$$= 10%$$ per annum

Time$$=2$$ years

To find the amount we have the formula,

$$Amount (A) = P (1+(R/100))^n$$
where $$P$$ is present value, $$r$$ is rate of interest, $$n$$ is time in years.

Now substituting the values in above formula we get,

$$\therefore A = 2500 (1 + 10/100)^2$$
$$\Rightarrow A = 2500 (11/10)^2$$
$$\Rightarrow A = 2500 (121/100)$$
$$\Rightarrow A = 25 (121)$$
$$\Rightarrow A = ₹ 3025$$

Now,
∴ Compound interest = $$A – P$$

$$=3025 – 2500= ₹ 525$$