Multiple choice

What is the amount after 2 years if Rs. 1000 is invested at 10% per annum compound interest?

  1. 1210

  2. 2001

  3. 5123

  4. 1612

  5. 4903
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A Correct answer
Explanation

The amount after 2 years with compound interest is calculated using the formula A = P(1 + r/100)^n. Substituting P = 1000, r = 10, and n = 2 gives A = 1000 * (1.1)^2 = 1000 * 1.21 = 1210.

AI explanation

Using the compound interest formula A equals P times the quantity 1 plus R divided by 100 close quantity raised to the time in years, we substitute the values to get 1000 times the quantity 1 plus 10 divided by 100 close quantity squared. This simplifies to 1000 times 1.1 squared, which equals 1000 times 1.21. The final amount is Rs. 1210.

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