What financial return does Kiran accumulate by depositing Rs.8000 at a 10% annual compound interest rate over a span of two years, compounded yearly?
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Answer: E. None of these
Explanation
Applying the compound interest formula to Rs. 8000 at 10 percent for two years multiplies the principal by 1.1 squared. Calculating this product yields a final compound amount of Rs. 9680 at the end of the two-year period. Since Rs. 9680 is not listed among the first four choices, option E represents the correct designated selection. Compound interest calculates interest on both the initial principal and all previously accumulated interest amounts. Annual compounding multiplies the principal by one plus the interest rate raised to the number of years. Standard test formatting uses a none-of-the-above choice when calculated financial totals do not appear in options A through D.
Option A represents an incorrect calculated financial return that does not match the true compound interest formula. Option B correctly calculates Rs. 9680, but because this value is omitted from choices A through D, option E is required. Option C underestimates the accumulated compound return over the specified two-year investment period.
- Subject
- Mathematics
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- Mathematics
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- Difficulty
- medium
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