Multiple choice

Mr. Rahul Ghosh wants to invest Rs. 50000 in a company. The current rate of interest is 9%. How much return will he receive at the end of 4 years if the interest is compounded yearly?

  1. 50000

  2. 70,579

  3. 100000

  4. 68000
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Using compound interest formula A = P(1+r)^n: A = 50000 × (1+0.09)^4 = 50000 × 1.41158 = 70,579 (rounded). Compound interest earns interest on accumulated interest, unlike simple interest which would only be 50000 × (1 + 0.09×4) = 68,000.

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