Multiple choice

What will be the compound interest obtained on a principal amount of Rs. 6800 at the rate of 4% per annum in 2 years?

  1. Rs.545.68

  2. Rs. 554.88

  3. Rs. 635.54

  4. Rs. 564.38

  5. None of these
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Use the compound interest formula: A = P(1 + r)^t. Here P = 6800, r = 0.04, t = 2. Amount = 6800 × (1.04)^2 = 6800 × 1.0816 = 7354.88. Compound Interest = Amount - Principal = 7354.88 - 6800 = 554.88. Option B is correct. Option A would be simple interest for 2 years, and other options are calculation errors.

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