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Question : Rs. 7205 is invested in a scheme of compound interest (compounding annually). If the rate of interest is 20% per annum, what is the interest earned (in Rs.) in 1 year?

Option 1: Rs. 1422

Option 2: Rs. 1540

Option 3: Rs. 1441

Option 4: Rs. 1544


Team Careers360 5th Jan, 2024
Answer (1)
Team Careers360 23rd Jan, 2024

Correct Answer: Rs. 1441


Solution : Given:
Principle ($P$) = Rs. 7205
Rate of compound interest ($R$) = 20% per annum
Time ($T$) = 1 year
So, the total interest = $P(1+\frac{R}{100})^T-P$
= $7205(1+\frac{20}{100})^1-7205$
= $7205(\frac{6}{5})-7205$
= 8646 – 7205
= Rs. 1441
Hence, the correct answer is Rs. 1441.

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