alleryRs 100 is invested at 10 per cent compounded annually. What is the amount at the end of 3 years?
ARs 130.00
BRs 133.10
CRs 131.00
DRs 134.10
Answer & Solution
Correct answer: B. Rs 133.10
1. End of year 1 = 100 + 10 = Rs 110.
2. End of year 2 = 110 + 11 = Rs 121.
3. End of year 3 = 121 + 12.10 = Rs 133.10.
4. Compound interest earned = 133.10 - 100 = Rs 33.10.
5. Simple interest over the same 3 years gives only Rs 30, so the answer Rs 130 is the trap.
_Source: syllabus Maths Ch7 'Comparing Quantities', comparison chart in section 7.4_
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