Discussion of Question with ID = 100 under Compound-Interest

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Question

What is the amount receivable on Rs. 20000 after 6 months, invested at a rate of 24% compounded quarterly?

A

Rs. 22472.

B

Rs. 22572.

C

Rs. 22372.

D

Rs. 22672.

Soln.
Ans: a

In this case r = $24/4$% and n = 2 because compounding is quarterly. So A = 20000 × $(1 + 6/100)^2$, which equals 2 × 106 × 106, i.e., Rs. 22472.


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