Ram invested Rs.20,000 in a mutual fund in the year 2012. The value of the mutual fund increased to Rs.32,000 in the year 2017, then the compound annual growth rate of his investment is (Given that $(1.6)^{\frac{1}{5}} = 1.098$)

9.8%

The correct answer is Option (3) → 9.8% **

Initial amount: Rs. 20,000

Final amount after 5 years (2012 → 2017): Rs. 32,000

Compound annual growth rate (CAGR):

$\text{CAGR} = \left(\frac{32000}{20000}\right)^{\frac{1}{5}} - 1$

$= (1.6)^{\frac{1}{5}} - 1$

Given: $(1.6)^{\frac{1}{5}} = 1.098$

Therefore,

$\text{CAGR} = 1.098 - 1 = 0.098$

CAGR = 9.8% per annum