Anil bought units of a fund for Rs. 60,000. During the year he received Rs. 1,800 as income from the fund. For his rate of return for the year to be 10%, the value of his units at the end of the year must be
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Rs. 64,200
A 10% rate of return on Rs. 60,000 means the total earned in the year must be
\( 60000 \times 0.10 = 6000 \)
The income already gives Rs. 1,800, so the rise in value must be
\( 6000 - 1800 = 4200 \)
So the end value must be
\( 60000 + 4200 = 64200 \)
Why the other options are incorrect
Option (1) Rs. 66,000 — Incorrect. This ignores the income; with it the return would be 7,800 ÷ 60,000 = 13%.
Option (3) Rs. 67,800 — Incorrect. This adds the income instead of letting it count towards the return; the return would then be 16%.
Option (4) Rs. 61,800 — Incorrect. The return would then be (1,800 + 1,800) ÷ 60,000 = 6% only.