Multiple choice

Calculate compound interest on Rs $2000$ for $2$ years at the rate $5\% $

  1. $105$
  2. $200$
  3. $205$
  4. $2205$
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

CI = P * ((1 + r/100)^n - 1). CI = 2000 * ((1.05)^2 - 1) = 2000 * (1.1025 - 1) = 2000 * 0.1025 = 205.

AI explanation

The compound interest for two years is calculated using the formula CI = Principal * [(1 + Rate/100)^2 - 1]. Substituting the given values into the formula gives CI = 2000 * [(1 + 5/100)^2 - 1] = 2000 * [1.1025 - 1] = 2000 * 0.1025. The compound interest is Rs. 205.

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