Mr. Rao invests a sum of Rs. 41,250 at the rate of 6 p.c.p.a. What approximate…
2024
Mr. Rao invests a sum of Rs. 41,250 at the rate of 6 p.c.p.a. What approximate amount of compound interest will he obtain at the end of 3 years?
- A.
Rs. 8100
- B.
Rs. 7425
- C.
Rs. 8210
- D.
Rs.7879
Attempted by 20 students.
Show answer & explanation
Correct answer: D
Key formula: A = P(1 + r)^n, where P is the principal, r is the annual rate (in decimal), and n is the number of years.
Given: P = Rs. 41,250, r = 6% = 0.06, n = 3.
Compute (1 + r)^n = 1.06^3 ≈ 1.191016.
Amount A = 41,250 × 1.191016 ≈ 49,129.41.
Compound interest = A − P ≈ 49,129.41 − 41,250 = 7,879.41 ≈ Rs. 7,879.
Answer: The approximate compound interest after 3 years is Rs. 7,879.