Multiple choice

Vineet deposited Rs. 15,600 in a fixed deposit at simple interest at the rate of 10%. After every second year he converts his interest earnings into deposits. His interest in the fourth year is-

  1. Rs. 1,716

  2. Rs. 1,560

  3. Rs. 3,432

  4. Rs. 1,872
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Principal = 15600, Rate = 10%. Interest for first 2 years = (15600 * 10 * 2) / 100 = 3120. New principal = 15600 + 3120 = 18720. Interest for the 3rd and 4th year = (18720 * 10 * 2) / 100 = 3744. Interest for the 4th year specifically is half of that, which is 1872.

AI explanation

Using the simple interest formula, the interest for the first two years is (15600 x 10 x 2) / 100, which equals Rs. 3,120. After every second year, this interest is added to the principal, making the new principal 15600 + 3120 = Rs. 18,720. The interest for the fourth year is calculated on this new principal, giving (18720 x 10 x 1) / 100, which results in Rs. 1,872.

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