Correct Answer - Option 2 : Rs. 69,300
Given:
Principal = Rs. 50,000
Rate for first year = 5%
Time = 3 years
Concept used:
A = P (1 + R1/100)(1 + R2/100)(1 + R3/100)
Where,
A → Amount
P → Principal
R1 → Rate of interest for first year
R2 → Rate of interest for second year
R3 → Rate of interest for third year
Calculations:
The rate of interest doubles itself in each successive year
So, Rate of interest for second year = 2 × 5 = 10%
Rate of interest for third year = 2 × 10 = 20%
Now, Amount = 50000 × (1 + 5/100)(1 + 10/100)(1 + 20/100)
A = 50000 × (105/100) × (110/100) × (120/100)
A = Rs. 69,300
∴ The amount of which is gained by Ram after 3 years is Rs. 69,300