Simple interest on a certain sum of money at the rate of 5 percent per annum for 4 years is Rs. 800. What will be the compound interest on the same sum for the same period at the same rate?
A850
B840
C855
D862 ✓ Correct
Correct answer: (D) 862
Explanation
The compound interest is about Rs. 862.
From SI: P x 5 x 4 / 100 = 800 gives P = 4000.
Amount = 4000 x (1.05)^4 = 4000 x 1.21550625.
Amount = 4862.03.
CI = 4862.03 - 4000 = 862 (approx).
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