Question

On what sum will the compound interest at $5\%$ p.a. for $2$ years compounded annually be Rs. $1,640$?

• A. $16,000$
• B. $630.50$
• C. $425.76$
• D. $1,640$

Answer 1

The correct option is A $16,000$

$1,640=P\left[\right(1+0.05{)}^2-1]$
$1,640=P(1.1025-1)$
Hence, the required sum is Rs. $16,000$