ECONOMICS (CBSE/UGC NET)

ECONOMICS

COMPOUND INTEREST

 Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Determine the balance in the account if you deposited \$4, 000 at an interest rate of 3.4% compounded quarterly for three years.
 A \$4422.03 B \$4427.62 C \$4428.90 D \$4429.51
Explanation:

Detailed explanation-1: -Detailed Solution ∴ Compound interest is Rs. 410.

Detailed explanation-2: -Rs 4505.96 money will be in the account after 2 years . Where P is the principle value, r is the rate in the decimal form and n is the time in years. 6% is written in the decimal form . Therefore Rs 4505.96 money will be in the account after 2 years .

Detailed explanation-3: -So, the correct answer is “410 Rs.”.

Detailed explanation-4: -Simple Interest Formula Thus, if simple interest is charged at 5% on a \$10, 000 loan that is taken out for three years, then the total amount of interest payable by the borrower is calculated as \$10, 000 x 0.05 x 3 = \$1, 500.

There is 1 question to complete.