A man invests Rs 8000 in a finance company that provides 24 percent annual compound interest, compounded monthly. Compute the compound interest on the invested amount for 3 months.
ARs 555.66
BRs 489.66 ✓ Correct
CRs 589.66
DRs 689.66
Correct answer: (B) Rs 489.66
Explanation
The compound interest is Rs 489.66.
Monthly rate = 24% / 12 = 2% per month.
Amount = 8000 x (1.02)^3.
(1.02)^3 = 1.061208, so amount = Rs 8489.66.
CI = 8489.66 - 8000 = Rs 489.66.
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