Multiple choice

Find the amount and the compound interest on Rs. 10,000 at 8 per cent per annum and in 2 years.

  1. Rs. 1885

  2. Rs. 1664

  3. Rs. 1332

  4. Rs. 1559
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B Correct answer
Explanation

Amount = P(1 + r/100)^n = 10000(1 + 0.08)^2 = 10000(1.1664) = 11664. Compound Interest = Amount - Principal = 11664 - 10000 = 1664.

AI explanation

Applying the compound interest formula, the total amount is calculated as 10000 multiplied by the quantity 1 plus 0.08 raised to the power of 2, yielding 10000 times 1.1664, which equals Rs. 11664. The compound interest is found by subtracting the principal from this amount, meaning 11664 minus 10000 gives Rs. 1664.

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