The compound interest (compounded annually) on a deposit is ₹1,320 for the second year and ₹1,452 for the third year. What is the rate of interest per annum?

about 9.1%Correct answerYour answer10%Correct answerYour answer11%Correct answerYour answer12%Correct answerYour answer

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CorrectNot quiteAnswer B

Correct answer: B

The third year's interest is the second year's interest plus interest on it: ₹1,452 − ₹1,320 = ₹132.
Rate = $\frac{132}{1320} \times 100 = 10\%$ .

Worth noting

The ₹132 is interest on the earlier year's ₹1,320, so divide by 1,320. Dividing by 1,452 gives about 9.1%.

Ten questions from Simple & Compound Interest, at your own pace.

Ten questions from Simple & Compound Interest, at your own pace.

Explanation