Mathematics for FinancePYQ Nov 19Question 1292 of 512
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1000\displaystyle 1000 is invested at annual rate of interest of 10%\displaystyle 10\% p.a. The amount after two years if compounding is done annually is ________.

Options

A121\displaystyle 121
B1210\displaystyle 1210
C2110\displaystyle 2110
DNone of these
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Correct Answer

✅ Option b — 1210\displaystyle 1210

All Options:

  • A121\displaystyle 121
  • B1210\displaystyle 1210
  • C2110\displaystyle 2110
  • DNone of these

Detailed Solution & Explanation

**Derivation of Future Value** Given: - Principal (P\displaystyle P) = Rs. 1,000\displaystyle \text{Rs. }1,000 - Rate of Interest (r\displaystyle r) = 10%\displaystyle 10\% per annum - Time (t\displaystyle t) = 2\displaystyle 2 years - Compounded annually **Step 1: Calculate the future value (A\displaystyle A)** A=P(1+r)tA = P(1 + r)^t A=1000(1+0.10)2A = 1000(1 + 0.10)^2 A=1000(1.10)2A = 1000(1.10)^2 A=1000×1.21=Rs. 1,210A = 1000 \times 1.21 = \text{Rs. }1,210 Hence, **Option B** is the correct answer.

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