An amount Rs. 8000 is invested in a scheme of compound interest. If rate of interest is 20% per annum, then what is the amount (in Rs) obtained after 3 years?a)12854b)12150c)13824d)20140Correct answer is option 'C'. Can you explain this answer?

Question

Answer

Given:
- Principal amount (P) = Rs. 8000
- Rate of interest (R) = 20% per annum
- Time period (T) = 3 years

To find:
The amount obtained after 3 years.

Solution:
The formula to calculate the compound interest is:

A = P(1 + R/100)^T

Where:
A = Amount after time period T
P = Principal amount
R = Rate of interest per annum
T = Time period in years

Substituting the given values into the formula:

A = 8000(1 + 20/100)^3
= 8000(1 + 0.2)^3
= 8000(1.2)^3

Calculating the value inside the parentheses first:

(1.2)^3 = 1.2 × 1.2 × 1.2
= 1.44 × 1.2
= 1.728

Now, substituting this value back into the formula:

A = 8000(1.728)
= 13824

Hence, the amount obtained after 3 years is Rs. 13824.

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