Question

If ₹12,500 is invested at 12% p.a. on compound interest for one year and 4 months, compounded annually, then the amount received is: 

Options

• ₹16,450

• ₹14,560

• ₹14.650

• ₹15.460

Answer 1

₹14.650

Explanation:

₹12,500 is invested at 12% p.a on compound interest for I year & 4 months i.e, `1 1/3` yrs.

For 1st year rate = 12% & for next `1/3` year, rate

= `1/3 xx 12% = 4%`

Compound interes

Amount received = 12500 + 1500 + 500 + 60

= ₹14.560