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    Question

    Find the compound interest on Rs. 5000 at 8% per annum

    for 2 years, compounded annually.
    A 832 Correct Answer Incorrect Answer
    B 775 Correct Answer Incorrect Answer
    C 900 Correct Answer Incorrect Answer
    D 725 Correct Answer Incorrect Answer

    Solution

    Amount A = P(1 + r/100)² = 5000 × (1 + 8/100)² = 5000 × (1.08)² = 5000 × 1.1664 = 5832 Compound interest = A − P = 5832 − 5000 = 832

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