Jaspreet deposited a sum of ₹12,800 at 5% rate of interest per annum, compounded annually. The total amount (in ₹) received by Jaspreet after 2 years will be:
14,112
We need to calculate the total amount Jaspreet will receive after 2 years when the interest is compounded annually at a rate of 5% per annum.
The formula for compound interest is:
A = P (1 + r/n)^(nt)
where:
- A is the amount of money accumulated after n years, including interest.
- P is the principal amount (the initial sum of money).
- r is the annual interest rate (decimal).
- n is the number of times that interest is compounded per year.
- t is the time the money is invested or borrowed for, in years.
Given:
- P = ₹12,800
- r = 5/100 = 0.05
- n = 1 (compounded annually)
- t = 2 years
Substituting the given values into the formula:
A = 12800 (1 + 0.05/1)^(1*2)
A = 12800 (1 + 0.05)^2
A = 12800 (1.05)^2
Calculate (1.05)^2:
(1.05)^2 = 1.1025
Now substitute back:
A = 12800 * 1.1025
A = ₹14,112
Thus, the correct answer is: 14,112
Similar Questions
- In what time will ₹ 4400 become ₹ 4576 at 8% per annum interest compounded half – yearly?
Important Questions from Compound Interest
The certain sum amounts to Rs. 9,982.50 in \(2\frac{1}{2}\) years at 12% p.a., interest compounded 10-monthly. The sum (in Rs.) is:
The difference between the simple interest and the compound interest compounded annually on a certain sum of money for 2 years at a rate of 8% per annum is Rs. 16.80. Find the principle amount.
If a sum of ₹ 2000 is lent at 10% p.a. compound interest, what is the interest for the second year?
A sum becomes 5 times of itself in 3 years. at compound interest (interest is compounded annually). In how many years. will the sum becomes 125 times of itself?
If the compound interest on a certain sum of money for two years at 9% p.a. is Rs. 3,762, then the sum is:
