ECONOMICS
COMPOUND INTEREST
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Mr Tan deposited $5000 into the Bank of OCBC .How much interest will he get at the end of 2 years with a simple interest of 2% per year.
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$5300
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$200
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$5200
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$300
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Explanation:
Detailed explanation-1: -Here, we will find simple interest (SI) using the formula PRN100 where, P is principal amount i.e. Rs. 5000, R is rate of interest i.e. 5% and N is time period i.e. 2 years. Thus, simple interest is Rs. 500.
Detailed explanation-2: -Therefore, the simple interest is Rs. 600.
Detailed explanation-3: -5832∴ C.I. = A-P = Rs. 5832-5000= Rs. 832 (c)
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