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Q.

Find the amount to be paid at the end of 1 year on 1,800 at 8% per annum compounded quarterly.

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a

 1848.377

b

 1948.377

c

 2948.377

d

 1748.377

answer is C.

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Detailed Solution

Principal = 1,800

There are 4 quarters in 1 year.

Therefore, compounding has to be done in 4 times.

Rate of interest = quarter of 8% = 2% quarterly.

A=P1+R100n

= 18001+21004

= 18001+0.024

= 1948.377

Therefore, the amount to be paid at the end of 1 year on 1,800 at 8% per annum compounded quarterly is  1948.377.

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