A invested an amount of ₹12,000 in a fixed deposit scheme for 2 years at an interest rate of 5% per annum, compounded annually. How much amount will A get on maturity of the fixed deposit?
Show answer & explanation
Correct answer: A
Explanation
The correct answer is Option 1 i.e. ₹13,230
Amount after 2 years = Principal × (1 + rate/100)2
⇒ Amount after 2 years = 12000 × (1 + 5/100)2
⇒ Amount after 2 years = 12000 × (21/20)2
⇒ Amount after 2 years = 12000 × {441/400}
⇒ Amount after 2 years = 30 × 441 = 13,230