Rs 32000 yield a compound interest of Rs 5044 in 9 months when interest being compounded quarterly. Find the rate of interest per annum.
Answer & explanation
Correct answer: option 1
Amount = 32000 + 5044 = 37044
ATQ,
⇒ Amount = P (1 + \(\frac{R}{100}\))t
⇒ 37044 = 32000 (1 + \(\frac{R}{100}\))3
⇒ 9261 = 8000 (1 + \(\frac{R}{100}\))3
⇒ (\(\frac{21}{20}\))3 = (1 + \(\frac{R}{100}\))3
⇒ R = \(\frac{1}{20}\) = 5% (quarterly)
⇒ Rate p.a. = 5% × 4 = 20%