Question

Mr. Sayyad kept Rs. 40,000 in a bank at 8% compound interest for 2 years. Mr. Fernandes invested Rs. 1,20,000 in a mutual fund for 2 years. After 2 years, Mr. Fernandes got Rs. 1,92,000. Whose investment turned out to be more profitable ?

Answer 1

Solution :

i ) Mr.Sayyad principal

(p)=Rs40000,

Rate of interest ( r ) = 8%

Time ( t ) = 2 years

Number of times

Interest paid (n) = 2

Let the amount = A

A = p( 1 + r/100 )ⁿ

= 40000( 1 + 8/100 )²

= 40000( 108/100 )²

= 40000 × 108/100 × 108/100

= Rs 46656

A = Rs 46656

Compound interest ( C.I )

= A - P

= Rs 46656 - Rs 40000

= Rs 6656

percentage = ( c.I × 100 )/p

= ( 6656 × 100 )/40000

= 16.64 % ---( 1 )

ii ) mr.fermandes investment

= 120000

Amount after 2 years = 192000

Profit = 192000 - 120000

= Rs 72000

Profit % = ( p × 100 )/investment

= ( 72000 × 100 )/( 120000 )

= 60% ---( 2 )

Mr.Fernandes investment is

more profitable.

••••

Answer 2

$Amount \: deposited \: by \: Mr. Sayyad \: kept \: Rs.= 40,000$

$Rate \: of \: interest=8%$

$CL=Amount-principle$

$P(1 + \frac{ R }{100}) ^{n - } P$

$= 40000( 1 + \frac{108}{100} )^{2} - 1 \\ = 40000(1.1664 - 1) \\ = 40000 \times 0.1664 \\ = Rs \: 6656$

$percentage \: profit = \frac{6656}{40000} \times 100 = 16.64$

$investment \: in \: mutual \: fund \: by \: Mr. Fernandes =Rs120000 \\ Return \: of \: investmen \: t= Rs \: 192000$

$Profit = 192000 - 120000 = Rs.72,000 \\ Percentage \: profit \: from \: mutual \: funds = \frac{72000}{120000} \times 100 = 60\%$

$Thus , \: investment \: by \: Mr. Fernandes \: turned \: out \: to \: be \: more \: profitable$