A sum of Rs. 10,000 is invested for a term of 2 and a half years at an interest rate of 8% compounded annually. The amount on maturity will be:
ARs. 12520.50
BRs. 12024.62
CRs. 12130.56 ✓ Correct
DRs. 11664.48
Correct answer: (C) Rs. 12130.56
Explanation
The maturity amount is Rs. 12130.56.
For the 2 full years use annual compounding.
10000 x (1.08)^2 = 10000 x 1.1664 = 11664.
For the half year add simple interest at 4%.
11664 x 1.04 = Rs. 12130.56.
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