Question

If the simple interest on a sum of money at 5% per annum for 3 years is Rs. 12000, the compound interest on the same sum for the same period at the same rate, is

• A. Rs. 12600
• B. Rs. 12610
• C. Rs. 12640
• D. Rs. 12650

Answer 1

Answer: (B)

Rs. 12610

Clearly, Rate = $5\%$, Time = $3$ years and S.I. = $\text{Rs.}12000$

Sum $=\text{Rs.}\left(\frac{100\times 12000}{3\times 5}\right)=\text{Rs.}80000$
Amount $=\text{Rs.}[80000\times {(1+\frac{5}{100})}^3]$
$=\text{Rs.}92610$

We know that C.I. = Amount - Sum
So,

C.I. $=92610-80000$
$=\text{Rs.}12610$