A certain sum is deposited for 4 years at a rate of 10% per annum on compound interest compounded annually. The difference between the interest at the end of 2 years and then at the end of 4 years is Rs 5,082. Find teh sum (in Rs).
Show answer & explanation
Correct answer: A
Explanation
The correct answer is option 1 i.e. 20,000
We know, the successive interest of a% and b% = (a + b + ab/100)%
The successive interest for 2 years = [10+ 10+ (10 x 10)/100]% = 21%
The successive interest for 3 years = [21 + 10 + (21 x 10)/100]% = 33.1%
The successive interest for 4 years = [33.1 + 10+ (33.1 x 10)/100]% = 46.41%
The difference of interest between 4 and 2 years = 46.41-21 = 25.41%
So, 25.41% is 5082
Then, 100% (5082/25.41) x 100 = 20000
Therefore, the sum (in Rs.) is Rs. 20000