Ramesh bought a house for ₹2,00,000. At the end of the first year, he sold it at a loss of 10% on his investment. He invested the money thus obtained at a rate of 20% p.a. interest compounded annually for 2 years. The value of this investment would amount to ___________.

₹2,59,200

Ramesh sold the house at a loss of 10%

i.e. = 200000 × \(\frac{100 - 10}{100}\)

= 200000 × \(\frac{90}{100}\)

= Rs. 180000

Now, this sum has given on compound interest ,

So, P = 180000

The Formula that we used here is -

Amount = P$(1 \;+\; \frac{R}{100})^t$

= 180000 [ 1 + \(\frac{20}{100}\) ]²

= 180000 × \(\frac{6}{5}\) × \(\frac{6}{5}\)

= Rs. 259200