| A man gets a simple interest of Rs. 1000 on a certain principal at the rate of 5% per annum in 4 yr. What compound interest will the man get on twice the principal in 2 yr at the same rate? |
A) Rs. 1050
B) Rs. 1005
C) Rs. 1025
D) Rs. 1125
E) None of these
Correct Answer: C
Solution :
| Case I Principal \[=\frac{SI\times 100}{Time\times Rate}\] |
| \[=\frac{1000\times 100}{4\times 5}=Rs.\,5000\] |
| Case II Principal = Rs. 10000 |
| \[\therefore \] \[CI=P\left[ {{\left( 1+\frac{Rate}{100} \right)}^{Time}}-1 \right]\] |
| \[=10000\left[ {{\left( 1+\frac{5}{100} \right)}^{2}}-1 \right]\] |
| \[=10000\times \left[ {{\left( \frac{21}{20} \right)}^{2}}-1 \right]\] |
| \[=10000\times \frac{41}{400}=Rs.\,1025\] |
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