Multiple choice

Find the compound interest on Rs. 8000 at 20% per annum for 9 months, compounded quaterly.

  1. Rs. 1261

  2. Rs. 1324

  3. Rs. 1285

  4. Rs. 1129
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A Correct answer
Explanation

For quarterly compounding, rate per quarter = 20%/4 = 5%, time = 9 months = 3 quarters. Using A = P(1 + r/100)^n: A = 8000(1.05)³ = 8000 × 1.1576 = 9261. Compound Interest = 9261 - 8000 = Rs. 1261.

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