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**WEEK 3**

**TOPIC: COMPOUND INTEREST**

**CONTENTS:**

- Profit and loss (revision)
- Simple interest (revision)
- Compound interest
- Word problems.

**PROFIT AND LOSS (REVISION)**

When any transaction is done, we either make profit or a loss. When an article is sold at a price greater than the price it was bought, then a profit is made. On the other hand, if an article is sold at a price less than the cost, we have made a loss.

Hence,

Profit = selling price – cost price

Loss = Cost price – selling price

In commercial transactions, profit and loss are usually expressed as a percentage of the cost price.

That is,

**profit percent = ^{profit}/_{cost price} X 100%**

**loss percent = ^{loss}/_{cost price} X 100%**

**Examples:**

- A trader bought a book for N75 and sold it for N What is the profit percent?

Solution

Cost price = N75

Selling price = N86

Profit = selling price – cost price

= N86- N75 = N11

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