A person deposited ₹15,600 in a fixed deposit at 10% per annum simple interest. After every second year he adds his interest each earned to the principal. The interest at the end of 4 years is :
Answer & explanation
Correct answer: option 2
Principal(P)= 15600
Rate(R) = 10%
Interest(I) of two years =10×2 = 20%
=20% of 15600
= \(\frac{1}{5}\) × 15600
= Rs 3120
so add Interest in Principle after every two years
=15600+3120
=Rs 18720
P=18720
Interest of two years 10×2=20%
20% of 18720
\(\frac{1}{5}\) × 18720
= Rs 3744
So Total Interest for 4 years = 3120+3744
= Rs 6864