The compound interest on an amount of ₹5120 at the rate of 12.5% (compounded annually) for 3 years is:

₹2280 ₹1960 ₹2120 ₹2170

₹2170

From the formula for compound interest, we know, C.I = P(1+$\frac{R}{100})^t$– P  = 5120 [ 1 + \(\frac{12.5}{100}\) ]³ - 5120  = 5120 [ \(\frac{9}{8}\) × \(\frac{9}{8}\) × \(\frac{9}{8}\) - 1 ]  = 5120 [ \(\frac{729}{512}\)  - 1 ] = 5120 [ \(\frac{217}{512}\) ] = 2170