1 Find the compound interest on Rs. 8000 at 4% per annum for 2 years, compounded annually.

1. 632.80
2. 650.00
3. 652.80
4. 672.80

Solution:
Answer: C

Explanation:
Principal Amount (P) = 8000
Interest Rate (r) = 4 %
Period (t) = 2 Years
Compounding Frequency (n) = 1

$=(8000\times (1+\frac{4}{100}{)}^2 )-8000$
$=652.80$

2 Find the compound interest on Rs. 8695 at 4% per annum for 3 years, compounded monthly.

1. Rs. 1106.63
2. Rs. 1126.63
3. Rs. 1206.63
4. Rs. 1236.63

Solution:
Answer: A

Explanation:
Principal Amount (P) = 8695
Interest Rate (r) = 4 %
Period (t) = 3 Years
Compounding Frequency (n) = 12

$=(8695\times (1+\frac{4}{100}{)}^{\mathrm{2\; \times \; 12}} )-8695$
$=1106.63$

3 Calculate the future value of Rs. 4,000 invested at 7% for 5 years

1. Rs. 5500.21
2. Rs. 5510.00
3. Rs. 5600.00
4. Rs. 5610.21

Solution:
Answer: D

Explanation:
Principal Amount (P) = 4000
Interest Rate (r) = 7 %
Period (t) = 5 Years
Compounding Frequency (n) = 1

$=(4000\times (1+\frac{7}{100}{)}^5)$
$=5610.21$