If a man invests ₹12000 for two years.

If a man invests ₹12000 for two years at the rate of 10% per annum compound interest, then the compound interest earned by him at the end of two years is

(a) ₹ 2400
(b) ₹2520
(c) ₹2000
(d) ₹1800

Solution:

(b) ₹2520
Hint – 12000 [(1 + 10/100)2 – 1] . 1200 (121-100/100) = 12000 × 21/100
= ₹2520

Mr. Rao bought 1-year, ₹10000 certificate of deposit that paid interest at an annual rate of 8% compounded semi-annually. The interest received by him on maturity is

(a) ₹816
(b) ₹864
(c) ₹800
(d) ₹10816

Solution:

(a) ₹816
Hint – 10000 [(1 + 4/100)2 – 1] = 10000 (676-625/625)
= 10000 × 51/625 = ₹816

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