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    Question

    A man loans out Rs. 22,100 at a simple interest rate of

    20% per annum. After 2 years, he reinvests the total amount received at an annual compound interest rate of 15%. What will be the compound interest earned on this reinvested amount after 2 years?
    A Rs. 9842.36 Correct Answer Incorrect Answer
    B Rs. 9756.52 Correct Answer Incorrect Answer
    C Rs. 9612.25 Correct Answer Incorrect Answer
    D Rs. 9978.15 Correct Answer Incorrect Answer
    E Rs. 9596.5 Correct Answer Incorrect Answer

    Solution

    Total amount after 2 years = 22100 + (22100 × 20 × 2)/100 = 22100 + 8840 = 30940 Compound interest = 30940 × ((1.15)2 – 1) = Rs. 9978.15

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