Multiple choice

The amount of $Rs. 10,000$ after $2$ years, compounded annually with the rate of interest being $10$% per annum during the first year and $12$% per annum during the second year, would be

  1. $Rs. 11,320$
  2. $Rs. 12,000$
  3. $Rs. 12,320$
  4. $Rs. 12,500$
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Amount = 10000 * (1 + 10/100) * (1 + 12/100) = 10000 * 1.1 * 1.12 = 11000 * 1.12 = 12320.

AI explanation

Using the successive percentage change formula for compound interest, the final amount is calculated as A = P(1 + R1/100)(1 + R2/100). Substituting the principal of 10,000, first year rate of 10%, and second year rate of 12%, we get A = 10000(110/100)(112/100). This simplifies to A = 10000 * 1.10 * 1.12 = 12320. The final amount is Rs. 12,320.

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