Question

Find the compound interest on 20,000 at 15% p.a.
compounded annually for two years.
(1) 6,000
(2) 5,850
(3) 4,950
(4) 16,450
(5) None of these​

Answer 1

Question:-

Find the compound interest on 20,000 at 15% p.a.

compounded annually for two years.

(1) 6,000

(2) 5,850

(3) 4,950

(4) 16,450

(5) None of these

Required Answer:-

Given:-

• Principle amount = Rs.20,000
• Rate of interest = 15%
• Time = 2 years.

To Find:-

• Compound interest.

Solution:-

We know that:-

$\\ \underline{\boxed{\tt{A = P(1 + \dfrac{R}{100} ) {}^{T}}}}$

Where,

• A is amount
• P is principle amount
• R is rate of interest
• T is time.

Substituting the values:-

$\\ \sf{\bold{Amount} = 20000(1 + \dfrac{15}{100} ) {}^{2}}$

$\\\sf{\implies{Amount} = 20000 \times (1 + 0.15) {}^{2}}$

$\\ \sf{\implies{Amount = 20000 \times {1.15}^{2}}}$

$\\ \sf{\implies{Amount = 20000 \times 1.3225}}$

$\\\sf{\therefore{Amount = \bold{26,450}}}$

Hence, the amount is Rs.26,450

Now,

Compound Interest = Amount - Principle Amount

=> Compound Interest = Rs.(26,450 - 20,000)

=> Compound Interest = Rs.6,450

Hence, the compound interest is Rs. 6,450

As, there is no option for Rs.6450, therefore, the correct option is (e) None of these