Question : A invested an amount of Rs. 12,000 in a fixed deposit scheme for 2 years at an interest rate of 5% per annum, compounded annually. How much amount will A get on maturity of the fixed deposit?
Option 1: Rs. 13,230
Option 2: Rs. 11,280
Option 3: Rs. 12,450
Option 4: Rs. 14,560
Correct Answer: Rs. 13,230
Solution :
When compounded annually, $ A= P(1+\frac{R}{100})^{T}$, Where $A$ is the total amount, $P$ is the principal amount, $R$ is the rate of interest per annum, and $T$ is the time in years.
Given:
$P$ = Rs. 12,000
$R$ = 5% per annum
$T$ = 2 years
Substituting these values into the formula,
$ A= 12000(1+\frac{5}{100})^{2}$
$ = 12000\times(\frac{21}{20})^{2}$
$ = 12000\times(\frac{441}{400})$
$ = 30\times 441 $
$ = 13230 $
Hence, the correct answer is Rs. 13,230.
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