Question

The compound interest on Rs 50,000 at 4% per annum for 2 years compounded annually is ______.

पर्याय

• Rs 4,000

• Rs 4,080

• Rs 4,280

• Rs 4,050

Answer 1

The compound interest on Rs 50,000 at 4% per annum for 2 years compounded annually is Rs 4,080.

Explanation:

Given, principal (P) = Rs. 50000

Rate of interest (R%) = 4% per annum

Time period (T) = 2 years

We know that,

`A = P(1 + R/100)^T`

∴ `A = 50000(1 + 4/100)^2`

= `50000(1 + 1/25)^2`

= `50000 xx 26/25 xx 26/25`

= 80 × 26 × 26

= Rs 54080

∴ Compound interest, CI = A – P

= Rs 54080 – Rs 50000

= Rs 4080

Hence, Rs 4,080