New Click here to Enroll in NaBFID Analyst Intro Class on May 6

    Question

    Diksha invested Rs. x in a scheme that offers compound

    interest at a rate of 31.25% per annum, compounded annually. The difference between the amount she receives after 3 years and 2 years is Rs. 22,050. Determine the initial investment value, x.
    A Rs. 40,960 Correct Answer Incorrect Answer
    B Rs. 40,320 Correct Answer Incorrect Answer
    C Rs. 56,760 Correct Answer Incorrect Answer
    D Rs. 30,540 Correct Answer Incorrect Answer
    E None of these Correct Answer Incorrect Answer

    Solution

    Given rate of interest = 31.25% = (5/16)

    Amount received from compound interest = P X (1 + rate/100) time

    So, amount received after 2 years = x X {1 + (5/16) }2 = Rs. {x X (21/16) 2}

    Amount received after 3 years = x X {1 + (5/16) }3 = Rs. {x X (21/16) 3}

    ATQ,

    {x X (21/16) 3} - {x X (21/16) 2} = 22050

    Or, x X (21/16) 2 X (21 - 16) = 22050 X 16

    Or, x = 22050 X (16/5) X (256/441)

    So, 'x' = 40,960

    Practice Next

    Relevant for Exams: