Present value = Rs.10240

Interest rate = (25/2) % per annum

Time = 3 years

Amount (A) = P (1 + R/100)ⁿ [Where, P = Present value

R = Annual interest rate

n = Time in years]

∴ A = 10240 [1 + (25/2)/100]³

⇒ A = 10240 [1 + 1/8]³

⇒ A = 10240 [9/8]³

⇒ A = 10240 × 9/8 × 9/8 × 9/8

⇒ A = 10240 × 729/512

⇒ A = 20 × 729

⇒ A = 14580

∴ Amount = Rs.14580

∴ Compound interest = Rs.(14580 – 10240)

= Rs.4340