Multiple choice

Ekansh borrowed Rs.$50,000$ for $2$ years at $20$ % per year compound interest. Calculate the final amount at the end of the second year.

  1. $70,000$
  2. $71,000$
  3. $72,000$
  4. $75,000$
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C Correct answer
Explanation

Amount = P * (1 + R/100)^n = 50000 * (1 + 20/100)^2 = 50000 * (1.2)^2 = 50000 * 1.44 = 72000.

AI explanation

Using the compound interest formula, the final amount equals the principal multiplied by 1 plus the rate divided by 100, all raised to the number of years. Substituting the given values, the amount is 50000 multiplied by 1 plus 0.20, with the sum raised to the power of 2. This simplifies to 50000 multiplied by 1.2 squared, which equals 50000 multiplied by 1.44. The final amount at the end of the second year is 72000.

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