The compound interest on ₹ 8,000 for 2 years is ₹ 1,331.20. What is the rate…
2018
The compound interest on ₹ 8,000 for 2 years is ₹ 1,331.20. What is the rate of compound interest per annum compounded annually?
- A.
6%
- B.
8%
- C.
10%
- D.
12%
Attempted by 15 students.
Show answer & explanation
Correct answer: B
Identify given values: Principal (P) = ₹8,000, Compound Interest (CI) = ₹1,331.20, Time (n) = 2 years.
Calculate Amount (A): A = P + CI = 8,000 + 1,331.20 = ₹9,331.20.
Apply compound interest formula: A = P(1 + r/100)^n
9,331.20 = 8,000(1 + r/100)²
1.1664 = (1 + r/100)²
Solve for r:
√1.1664 = 1 + r/100
1.08 = 1 + r/100
0.08 = r/100
r = 8%
Final Answer: Option 2