A sum of Rs. 5000 is invested for two years under compound interest at 10% p.a, interest being compounded annually. The interest earned (in Rs) is :
Show answer & explanation
Correct answer: C
Explanation
The correct answer is option 3 i.e. 1050
CI = {P(1+R/100)T} - P
CI = {5000(1+10/100)2} - 5000
CI = (5000 × 11/10 × 11/10) - 5000
CI = 6050 - 5000
CI = 1050