In 4 years at simple interest the principal increases by 12%. Calculate the amount (in Rs) received at the end of 2 years on Rs 20,000 at the same rate if compounded annually?
Show answer & explanation
Correct answer: B
Explanation
The correct answer is option 2 i.e. 21218
|
Understanding |
Application |
|
In 4 years at simple interest the principal increases by 12%. |
So, 0.12P = (P × R × 4)/100 R = 3 |
|
Now, P = 20000 T = 2 years R = 3% |
So, A = 20000 × (1 + 3/100)2 = 20000 × 1.0609 = 21218 |