Question

Find the amount and the compounded interest on $₹3600$ for 2 years compounded annually, the rates of interest are $8\%$ during the first year and $10\%$ during the second year.

• A. $A=4276.80$, C.I. $=676.80$
• B. $A=5246.40$, C.I. $=494.20$
• C. $A=4822$, C.I. $=786.80$
• D. $A=4788.80$, C.I. $=624.60$

Answer 1

Answer: (A)

$P=₹3600$
$T=2$ years
$R=8\%$ pa and $10\%$ pa
Amount after first year
$A_1=P\left(1+\frac{R}{100}\right)=3600\left(1+\frac{8}{100}\right)$
$=36\times 108$
$=₹3888$
Amount after $2^{\text{nd }}$ year
$A_2=A_1\left(1+\frac{R}{100}\right)=3888\left(1+\frac{10}{100}\right)=3888\left(\frac{11}{100}\right)$
$=₹4276.80$
$\therefore$ Amount at the end of second year $=₹4276.80$ and the interest $=4276.80-3600=₹676.80$