If Rs.62500 for 2 years 6 months at 12% per annum compounded annually. Find the amount.

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21604

15406

19440

20604

answer is D.

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Detailed Solution

Concept- Simple interest is based on the principal amount of a loan or the first deposit in a savings account
Present value = Rs.62500
Interest rate = 12 % per annum
Time = 2 years 6 month = (2 + 1/2) years = (5/2) years
Amount (A) = P (1 + R/100)n [Where, P = Present value
R = Annual interest rate
n = Time in years]
∴ A = 62500 (1 + 12/100)2 × [1 + (1/2 × 12)/100]
⇒ A = 62500 (1 + 3/25)2 × [1 + 6/100]
⇒ A = 62500 (28/25)2 × [106/100]
⇒ A = 62500 × 28/25 × 28/25 × 106/100
⇒ A = 625 × 784/625 × 106
⇒ A = 1 × 784 × 106
⇒ A = 83104
∴ Amount = Rs.83104
∴ Compound interest = Rs.(83104 – 62500)
= Rs.20604
Hence, the Correct option is 4.

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