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The simple interest accrued on a sum of certain principal is Rs. 2000/- in five years at the rate of 4 p.c.p.a. what would be the compound interest accrued on same principal at same rate in two years?
  • a)
    716
  • b)
    724
  • c)
    824
  • d)
    816
  • e)
    None of these
Correct answer is option 'D'. Can you explain this answer?
Most Upvoted Answer
The simple interest accrued on a sum of certain principal is Rs. 2000/...
Given,
Simple Interest = Rs. 2000/-
Time = 5 years
Rate = 4% p.a.

To find,
Compound Interest for 2 years

Formula used,
Simple Interest = (P × R × T)/100
Compound Interest = P[(1 + R/100)^T - 1]

where P is the principal, R is the rate of interest, and T is the time period.

Calculation:
Using the formula of simple interest,
2000 = (P × 4 × 5)/100
P = 10000

Using the formula of compound interest,
Compound Interest = 10000[(1 + 4/100)^2 - 1]
Compound Interest = Rs. 816

Therefore, the compound interest accrued on the same principal at the same rate in two years is Rs. 816. Hence, the correct answer is (d) 816.
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The simple interest accrued on a sum of certain principal is Rs. 2000/- in five years at the rate of 4 p.c.p.a. what would be the compound interest accrued on same principal at same rate in two years?a)716b)724c)824d)816e)None of theseCorrect answer is option 'D'. Can you explain this answer?
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