Quantitative Aptitude • Simple & Compound InterestMedium
What will ₹1,450 amount to in 2 years at 20% per year compound interest, compounded annually?
A. ₹2,088✓ Correct Answer
B. ₹638
C. ₹1,740
D. ₹2,030
💡 Solution & Explanation
Amount = principal × (1 + rate/100)². After year 1: ₹1,450 × 120/100 = ₹1,740. After year 2: ₹1,740 × 120/100 = ₹2,088. With simple interest it would be only ₹2,030; compounding also earns interest on the first year's interest.
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