Question

Rs. $2,000$ is invested at annual rate of interest of $10\%$. What is the amount after two years if compounding is done annually?

• A. $2,420$
• B. $2,431$
• C. $2,436.80$
• D. $2,440.58$

Answer 1

The correct option is A $2,420$

$A_n=P(1+i{)}^n$
$A_2=Rs.2,000(1+0.1{)}^2$
$=Rs.20000\times (1.1{)}^2$
$=Rs.2,000\times 1.21$
$=Rs.2,420$