A sum of ₹2000 is invested at compound interest (compounding annually). If the rate of interest is 10% per annum, then what will be the amount after 30 months?
Answer & explanation
Correct answer: option 3
Time = 30 months = 2.5 years
For last 6 months , Actual rate of interest = \(\frac{10}{2}\)% = 5%
From the formula for compound interest, we know,
Amount = P(1+$\frac{R}{100})^t$
= 2000 [ 1 + \(\frac{10}{100}\) ]² × [ 1 + \(\frac{5}{100}\) ]
= 2000 [ \(\frac{11}{10}\) × \(\frac{11}{10}\) × \(\frac{21}{20}\) ]
= 2000 [ \(\frac{2541}{2000}\) ]
= Rs. 2541