Question

25,000/- is borrowed at compound interest at the rate of 3% for first year, 4% for 2^nd year and 5% for 3^rd year. Find the amount to be paid after 3 years.
1. 28,117/-
2. 28,118/-
3. 28,120/-
4. 28,119/-

Answer 1

Correct Answer - Option 4 : 28,119/-

Calculation:

Rate of interest for 1st year 3%, for 2nd year 4% and for 3rd year 5%

Principal = 25000

Amount after 3 year = 25000 × (1 + 3/100) × (1 + 4/100) × (1 + 5/100)

⇒ 25000 × (103/100) × (104/100) × (105/100)

⇒ 28119

∴ The amount to be paid after 3 years is Rs.28119.