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A invested an amount of Rs12,000 in a fixed deposit scheme for 2 years at an interest rate of 5% per annum, compounded
annually. How much amount will A get on maturity of the fixed deposit?
Rs13,230
Rs11,280
Rs12,450
Rs14,560
- Principal Investment: A invests Rs12,000.
- Interest Rate: 5% per annum, compounded annually.
- Investment Duration: 2 years.
Let's calculate using the formula for compound interest:
A = P(1 + r/n)^(nt)
Where:
- A is the amount on maturity.
- P is the principal amount (Rs12,000).
- r is the annual interest rate (0.05).
- n is the number of times interest is compounded per year (1 for annually).
- t is the time the money is invested for (2 years).
A=12000(1+0.05/1)1×2=12000(1.05)2=12000×1.1025=13230
- Option 1: Rs13,230
- Option 2: Rs11,280
- Option 3: Rs12,450
- Option 4: Rs14,560
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