Multiple choice

If the simple interest on a sum of money at 5% per annum for 2 years is Rs. 1400, find the compound interest on the same sum for the same period at the same rate.

  1. 3514

  2. 1322

  3. 1050

  4. 1435

Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

SI = P × R × T / 100, so 1400 = P × 5 × 2 / 100, giving P = 14000. CI = P(1 + R/100)² - P = 14000(1.05)² - 14000 = 14000 × 1.1025 - 14000 = 15435 - 14000 = 1435.