A man invests Rs 5000 in a bond which gives compound interest at 4 percent per annum during the first year, 5 percent per annum during the second year and 10 percent during the third year. How much amount will the man get at the end of the third year?
ARs 6500
BRs 5500
CRs 5999
DRs 6006 ✓ Correct
Correct answer: (D) Rs 6006
Explanation
The maturity amount is Rs 6006.
Each year the amount is multiplied by (1 + rate).
Year 1: 5000 x 1.04 = 5200.
Year 2: 5200 x 1.05 = 5460.
Year 3: 5460 x 1.10 = 6006.
Method: successive compounding with changing yearly rates.
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