Question

    Kamal invested Rs. 6,250 in scheme ‘A’ offering simple

    interest of 13% p.a. 4 years later, he reinvested the entire interest earned from scheme ‘A’ in another scheme ‘B’ offering compound interest of 10% p.a compounded annually. Find the total amount received from scheme ‘B’ after 2 years.
    A Rs.2,149.28 Correct Answer Incorrect Answer
    B Rs.5,149.28 Correct Answer Incorrect Answer
    C Rs.7,149.28 Correct Answer Incorrect Answer
    D Rs.3,932.50 Correct Answer Incorrect Answer

    Solution

    ATQ,

    Interest received from scheme ‘A’ = (6250 × 13 × 4) ÷ 100 = Rs. 3,250

    Total amount received from scheme ‘B’ = 3250 × {1 + (10/100)}² = 3250 × (110/100)²

    = 3250 × 1.21 = Rs. 3,932.50

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