Question

Mohit invests Rs. 8,000 for 3 years at a certain rate of interest, compounded annually. At the end of one year it amounts to Rs. 9,440. Calculate: the interest accured in the third year.

• A. Rs. 2,005.06
• B. Rs. 2,196.06
• C. Rs. 2,207.06
• D. None of these
  

Answer 1

The correct option is A Rs. 2,005.06

$P=Rs.8000$

Amount after one year $=Rs.9440$

Interest for 1 year$=9440-8000=Rs.1440$

let rate of interest=R

C.I for one year=S.I for 1 year$=\frac{PRT}{100}$

$\Rightarrow 1440=\frac{8000\times R\times 1}{100}$

$\Rightarrow R=\frac{1440\times 100}{8000}=18$%

For second year

$P=9440$

$R=18$ %

$T=1$ year

$\therefore Amount=P{(1+\frac{R}{100})}^T$

$\Rightarrow 9440(1+\frac{18}{100})$

$\Rightarrow 9440\times \frac{118}{100}=Rs.11139.20$

Hence Amount at the end of second year $=Rs.11139.20$

For the third year

$P=Rs.11139.20$

$R=18$%

$T=1$ year

$Interest=\frac{11139.20\times 18\times 1}{100}=Rs.2005.06$

Hence interest for third year $=Rs.2005.06$