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    Question

    The interest earned when a sum is invested at simple

    interest of 25% p.a., for 3 years, is Rs. 1875. What will be the total amount received after 2 years on investing the same sum at compound interest (compounded annually) of 14% interest p.a.?
    A Rs. 3249 Correct Answer Incorrect Answer
    B Rs. 3209 Correct Answer Incorrect Answer
    C Rs. 3250 Correct Answer Incorrect Answer
    D Rs. 3549 Correct Answer Incorrect Answer

    Solution

    Let the sum invested = Rs. Y According to the question, (Y × 3 × 25) ÷ 100 = 1875 So, Y = (1875/0.75) = 2500 So, required amount received = 2500(1 + 14/100)2 = 2500(114/100)2 = Rs. 3249

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