ABC26GN4152 · Compound Interest

Subject: General Aptitude · Chapter: Compound Interest · Exam: 2010 · Marks: · Difficulty:

A man gets a simple interest of ₹ 1000 on a certain principal at the rate of 5 p.c.p.a. in 4 years. What compound interest will the man get on twice the principal in 2 years at the same rate?
(a)₹ 1000
(b)₹ 1005
(c)₹ 10125
(d)₹ 11025
(e)None of these
Answer
Answer (as printed): E
Explanation
Principal $=₹\left(\frac{100 \times 1000}{5 \times 4}\right)=₹ 5000$. Now, $\mathrm{P}=₹ 10000, \mathrm{T}=2$ years, $\mathrm{R}=5 \%$. $$\begin{aligned} \text { Amount } & =₹\left[10000\left(1+\frac{5}{100}\right)^{2}\right] \\ & =₹\left(10000 \times \frac{21}{20} \times \frac{21}{20}\right)=₹ 11025 . \\ \therefore \quad \text { C.I. } & =₹(11025-10000)=₹ 1025 . \end{aligned}$$

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