Question
Rs. 10000 is invested in scheme ‘A’ for a year at
simple interest of 29% p.a. The interest received from scheme ‘A’ is reinvested for 2 years in scheme ‘B’ which offers compound interest (compounded annually) of 50% p.a. What is the total amount received from scheme ‘B’?Solution
Interest received from scheme ‘A’ = 10000 × (29/100) = Rs. 2900 Amount received from scheme ‘B’ = 2900 × {1 + (50/100)2} = 2.25 × 2900 = Rs. 6525
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