At an inflation rate of 10% per year, how much will a 4-year college degree cost 3 years later, if it costs Rs. 4 lakhs today? If you put Rs. 4 lakhs in a savings account at 5% compound interest today, will you have enough money to pay for your college fees after 3 years?
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Gone are the days of school mathematics, most of us easily forget, but a quick refresher may bring it all back. To understand compound interest in the easiest form, let’s take a look at what it means. Compound interest is a useful financial concept in which your interest earned is added to your principal. This amount then continues to earn more interest. So in this case, you also earn interest on the interest you’ve already earned. So your balance grows at an increasing rate. In a sense, you reinvest your interest, rather than receiving a pay-out.
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50%
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pls mark brainliest
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