New Upcoming Legal Jobs Free Workshop March 11 at 5 PM. Register here

    Question

    Rahul invested a certain amount at a simple interest

    rate of 8% per annum, and after 6 years, it grew to Rs. 1,850. If he had instead invested the same sum at a compound interest rate of 20% per annum for 2 years, what would be the total amount he would have after those 2 years?
    A Rs.1,850 Correct Answer Incorrect Answer
    B Rs.1,500 Correct Answer Incorrect Answer
    C Rs.2500 Correct Answer Incorrect Answer
    D Rs.1,800 Correct Answer Incorrect Answer
    E none of these Correct Answer Incorrect Answer

    Solution

    ATQ, Simple interest = (sum × rate of interest × time period in year) ÷ 100 Let the sum invested be Rs. 'S' So, 1850 - S = (S × 8 × 6) ÷ 100 Or, 1850 - S = 0.48S Or, 1850 = 1.48S So, S = 1250 Amount received from second investment = Sum × {1 + (rate/100)}Time period So, required amount = 1250 × {1 + (20/100)}2  = 1.44 × 1250 = Rs. 1,800

    Practice Next

    Relevant for Exams: