What is the compound interest (in ₹) on a sum of ₹25,000 for 3 years at 10% p.a., if the interest is compounded annually?
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Correct answer: A
Explanation
The correct answer is option 1 i.e. 9,606.
Total time = 3 years = 3.4 years
Amount for 3 years = 25000 × (1 + 10/100)3 = 25000 × (11/10)3 = 33275
SI for remaining 0.4 years = (33275 × 10 × 0.4)/100 = 1331
Total amount after 3.4 years = 33275 + 1331 = 34606
Total CI = 34606 - 25000 = 9606