Multiple choice

Find the compound interest on Rs. 8000 at 20% per annum for 1 year, compounded quarterly?

  1. Rs. 1524.05

  2. Rs. 1674.05

  3. Rs. 1724.05

  4. Rs. 1804.05

  5. Rs. 1934.05
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Principal = Rs. 8000, annual rate = 20%, time = 1 year, compounded quarterly. Quarterly rate = 20/4 = 5%. Number of quarters = 4. Amount = 8000 × (1 + 5/100)⁴ = 8000 × (1.05)⁴ = 8000 × 1.21550625 = Rs. 9724.05. Compound Interest = 9724.05 - 8000 = Rs. 1674.05.

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