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AFCAT Model Paper 8

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Question : 67 of 100

Marks: +1, -0

Find the compound interest on Rs. 50,000 in 3 years if the rate of interest is 5% p.a. for the first year, 4% p.a. for the second year, and 2% p.a. for the third year?

Rs. 5520
Rs. 6420
Rs. 5692
Rs. 5830

Solution:

Given:

Principal = Rs. 50,000

Rate for the first year = 5%

Rate for the second year = 4%

Rate of the third year = 2%

Formula:

A=P\left(1+\frac{R_{1}}{100}\right)\left(1+\frac{R_{2}}{100}\right)\left(1+\frac{R_{3}}{100}\right)

Where,

A=

Amount,

P=

principal,

R_{1}=

Rate for first year,

R_{2}=

Rate for second year and

R_{3}=

Rate for third year

Calculation:

A = 50,000 \times \left(\frac{105}{100}\right) \times \left(\frac{104}{100}\right) \times \left(\frac{102}{100}\right)

\Rightarrow A = 50,000 \times \left(\frac{21}{20}\right) \times \left(\frac{26}{25}\right) \times \left(\frac{51}{50}\right)

⇒ A = 55692

Hence, CI = 55692 – 50,000 = Rs. 5692

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