Quantitative Aptitude • Simple & Compound InterestMedium
What is the compound interest on ₹900 for 2 years at 20% per year, compounded annually?
A. ₹1,296
B. ₹180
C. ₹396✓ Correct Answer
D. ₹360
💡 Solution & Explanation
Year 1 interest = 20% of ₹900 = ₹180, so the amount becomes ₹1,080. Year 2 interest = 20% of ₹1,080 = ₹216. Total compound interest = ₹396. Simple interest would be only ₹360; the extra is interest earned on the first year's interest.
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