Find the compound interest on ₹5,50,000 at 7% per annum for 2 years, compounded annually.

₹80,605 ₹62,695 ₹79,690 ₹79,695

₹79,695

From the formula for compound interest, we know, C.I = P(1+$\frac{R}{100})^t$– P  = 550000 [ 1 + \(\frac{7}{100}\) ]²   - 550000  = 550000 [ \(\frac{107}{100}\) × \(\frac{107}{100}\)  - 1 ]  = 550000 [ \(\frac{ 11449 }{10000}\)  - 1 ]  = 550000 [ \(\frac{ 1449 }{10000}\)  ] = Rs. 79695