Question

Sam invested in a policy which offers a $8\%$ compound rate annually, if he invested a sum of $₹10000,$ then the interest earned from ${10}^{th}$ to ${11}^{th}$ year will be:

• A. $₹2139.45$
• B. $₹1727.14$
• C. $₹1539.87$
• D. $₹2453.34$

Answer 1

The correct option is B $₹1727.14$

Given $P=₹10000;R=8$
Now, interest earned by him from ${10}^{th}\text{to}{11}^{th}$ year
$=P(1+\frac{R}{100}{)}^{11}-P(1+\frac{R}{100}{)}^{10}=P(1+\frac{R}{100}{)}^{10}(1+\frac{R}{100}-1)=P(1+\frac{R}{100}{)}^{10}\frac{R}{100}=10000(1+\frac{8}{100}{)}^{10}\times \frac{8}{100}=10000\times {1.08}^{10}\times 0.08=1727.14$
Thus, interest earned by him is $₹1727.14$