Questions & Answers

Question

Answers

A) 4200

B) 4300

C) 4400

D) 4500

Answer
Verified

Given principal amount is

P=Rs 20000

Time to repay the amount is

T= 2 years

Rate of interest is

R=10% per annum

To find the amount of compound interest after 2 years

C.I. = ?

To calculate the compound interest first we will calculate the final amount that we need to pay after 2 year

We know that the formula to calculate the final amount

$$A = P{\left( {1 + \dfrac{R}{{100}}} \right)^T}$$

On putting the given values

$$A = 20000 \times {\left( {1 + \dfrac{{10}}{{100}}} \right)^2}$$

On simplification

$$A = 20000 \times \dfrac{{121}}{{100}}$$

Now we will calculate the compound interest

We know that

∴ $$C.I. = A - P$$

On putting the values of A and P

We get

$$ = Rs.24,200 - Rs.20,000$$

On subtracting

We get

$$ = Rs.4200.$$

Therefore the correct option is ‘A’

×

Sorry!, This page is not available for now to bookmark.