Multiple choice

Rs 2304 is kept at compound interest for 2 years. This amount becomes 2500 at 2 years at any rate. Find the rate of interest?

  1. $24/5$
  2. $23/3$
  3. $22/4$
  4. $25/6$
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

For compound interest: A = P(1 + r)ⁿ. Given P = 2304, A = 2500, n = 2. So 2500 = 2304(1 + r)². Then (1 + r)² = 2500/2304 = 625/576. Therefore 1 + r = 25/24, so r = 1/24 = 25/600 = 25/6%. Option A (24/5 = 4.8%) is incorrect. Option B (23/3 ≈ 7.67%) doesn't match. Option C (22/4 = 5.5%) is wrong. The answer 25/6% ≈ 4.17% is correct.

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