Aptitude | Compound Interest | Question 5

Find the amount returned for an investment of Rs.5,000 after 2 years, if the rate of interest for the 1st year is 5% and for the 2nd year is 10%.
(A) 772
(B) 775
(C) 622
(D) 820


Answer: (B)

Explanation: Amount = (Principal + Compound interest) = P(1 + R1/100)(1 + R2/100)(1 + R3/100)
Amount = 5000(1 + 5/100)(1 + 10/100)
= 5000 x (21/20)(11/10)
= 5000 x (231/200)
=5775
Interest = 5775 – 5000 = 775

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