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Question : What is the Compound Interest (in Rs.) on Rs. 12500 at the rate of 12% per annum compounded yearly for 2 years?

Option 1: Rs. 3000

Option 2: Rs. 2980

Option 3: Rs. 3050

Option 4: Rs. 3180


Team Careers360 6th Jan, 2024
Answer (1)
Team Careers360 25th Jan, 2024

Correct Answer: Rs. 3180


Solution : Principal, P = Rs. 12500
Time = 2 years
Rate = 12%
Compound Interest = P[$(1+\frac{r}{100})^n-1$], where P is principal, $r$ is rate of interest compounded annually for $n$ years.
= 12500[$(1+\frac{12}{100})^2-1$]
= 12500[$(1.12)^2-1$]
= 12500[1.2544 – 1]
= 12500 × 0.2544 = Rs. 3180
Hence, the correct answer is Rs. 3180.

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