NIFT UG 2011 Question Paper with solutions

Question : 12 of 150

Marks: +1, -0

What is the compound interest on ₹5,000 for 4 years if the rate of interest is 10% p.a. for the first 2 years and 20% p.a. for the next 2 years?

Solution:

A=5000(1+{10}/{100})^{2}

A=5000×{11}/{10}×{11}/{10}={\Rs}6050

Again for next two years the above amountwill be principal

∴A=6050(1+20/100)^2

=6050×6/5×6/5=\Rs.8712

∴ C.I.

=8712-5000=\Rs.3712

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