Rakesh invests 10,000 rupees in a fixed deposit scheme for 2 years at 5% per annum compound interest. How much amount will he receive on maturity of fixed deposit?
A. Rs. 10,000
B. Rs. 8500
C. Rs. 11,050
D. Rs. 11,025
- AOption (a)
C
- BOption (b)
A
- COption (c)
B
- DOption (d)
D
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Correct answer
D
Why this answer is correct
Given:
Rakesh invests 10,000 rupees in a fixed deposit scheme for 2 years at 5% per annum compound interest.
Formula used:
Amount = P × (1 + R/100)T
P = Principal
R = rate %
T = time
Calculation:
According to the question,
P = Rs. 10,000, R = 5%, T = 2 years
Amount = P × (1 + R/100)T
⇒ Amount = 10,000 × (1 + 5/100)2
⇒ 10,000 × 105 × 105/10,000
⇒ Rs. 11,025
∴ He will receive Rs. 11,025 on maturity of fixed deposit amount.
By using ladder system
P = Rs. 10000, R = 5%, T = 2 years
Amount = principal + compound interest
⇒ 10000 + 1025
⇒ Rs. 11025
∴ He will receive Rs. 11,025 on maturity of fixed deposit amount.