What would be the interest accrued in two years if ₹600 is invested @ 10\% interest compounded annually? - Quantitative Aptitude MCQ UP Police Constable 2026 | ExamTest.live

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What would be the interest accrued in two years if ₹ 600 is invested @ 10% interest compounded annually?

Solution & Step-by-step Explanation

Method 1: Formula Approach The compound interest formula for amount A is: A = P (1 + \frac{R}{100})^{T} Given: P = 600, R = 10%, T = 2 years A = 600 (1 + \frac{10}{100})^{2} = 600 (\frac{11}{10})^{2} A = 600 \times \frac{121}{100} = 6 \times 121 = ₹ 726 Compound Interest (CI) = A - P = 726 - 600 = ₹ 126 Method 2: Effective Interest Rate Method Effective rate for 2 years at 10% compounded annually: R_{eff} = 10 + 10 + \frac{10 \times 10}{100} = 21% Interest accrued = 21% of 600 = \frac{21}{100} \times 600 = ₹ 126

Try it yourself before checking the explanation above.

What would be the interest accrued in two years if ₹ 600 is invested @ 10% interest compounded annually?

₹121

₹123

₹124

₹126

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