Question

A sum of ₹ 5000 is invested for two years under compound interest at 10% p.a, interest being compounded annually. The interest earned (in ₹) is:

• A. 2100
• B. 1000
• C. 1050
• D. 500

Answer 1

Answer:

C. 1050

Solution: Given: Principal = Rs. 5000 Rate = 10% Time = 2 years Formula Used: A = P(1+r/100)t C.I = A - P Calculations : Substituting the values in formula A = 5000(1+10/100)2 A = (110 × 110)/2 ⇒ A = 12100/2 ⇒ A = Rs.6050 C.I ⇒ A - P = 6050 -5000 ∴ C.I = Rs. 1050