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    • Question

      A customer deposits ₹5 lakh in a fixed deposit for 3

      years. The bank offers an interest of 6% per annum, compounded quarterly. Which formula is used to compute the maturity amount?
      A A = P(1 + rt) Correct Answer Incorrect Answer
      B A = P(1 + r/n)nt Correct Answer Incorrect Answer
      C A = P(1 + r/n)t Correct Answer Incorrect Answer
      D A = P × r × t Correct Answer Incorrect Answer

      Solution

      Quarterly compounding follows the compound interest formula: A = P(1 + r/n)ⁿᵗ, where n is the number of compounding periods in a year.

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