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    Question

    Ankit placed some money in a fixed deposit that provides

    a compound interest rate of 16% per annum, compounded yearly. At the end of two years, he received a total amount of Rs. 2,523. Determine the initial amount he invested.
    A Rs.1,505 Correct Answer Incorrect Answer
    B Rs.2,075 Correct Answer Incorrect Answer
    C Rs.1,875 Correct Answer Incorrect Answer
    D Rs.3,875 Correct Answer Incorrect Answer

    Solution

    ATQ,

    Let the principal amount be Rs. ‘x’. ATQ; 2523 = x × (1.16)2 Or, x = 1875 Therefore, the money invested = Rs. 1,875

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