Question

    Quantity I: A person invests Rs. 10,000 in a bank at an

    interest rate of 5% per annum, compounded annually. What is the total amount in the account after 3 years? Quantity II: Another person invests Rs. 12,000 in a different bank at an interest rate of 4% per annum, compounded annually. What is the total amount in that account after 2 years? Two quantities, Quantity I and Quantity II, are provided. Your task is to solve both quantities and determine the correct relationship between them. Choose the appropriate option.
    A Quantity I < Quantity II Correct Answer Incorrect Answer
    B Quantity I ≥ Quantity II Correct Answer Incorrect Answer
    C Quantity I ≤ Quantity II Correct Answer Incorrect Answer
    D Quantity I = Quantity II Correct Answer Incorrect Answer
    E Quantity I > Quantity II Correct Answer Incorrect Answer

    Solution

    Quantity I: Total amount after 3 years = P(1 + r/100n)^(nt)  = 10000(1 + 0.05/1)^(1*3)  = 10000(1.157625)  = 11576.25. Quantity II: Total amount after 2 years = P(1 + r/100n)^(nt)  = 12000(1 + 0.04/1)^(1*2)  = 12000(1.0816)  = 12979.20. Answer: A (Quantity I < Quantity II)

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