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EMI, CAGR & Depreciation · Question 29 of 66

Question 29

EasyOriginal question

₹1,00,000 grows to ₹1,44,000 in 2 years. What is the CAGR?

Options for question 29

Show the answer and explanation
CorrectNot quiteAnswer B

Correct answer: B

Explanation

  1. EB=1.44\frac{E}{B} = 1.44, and 1.44=1.2\sqrt{1.44} = 1.2.

  2. CAGR =1.2−1=20%= 1.2 - 1 = 20\%.

Worth noting

22% halves the total growth of 44%; compounding makes the yearly rate smaller.

Concept
CAGR from the start and end values
Typical time
60 s
Your time
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The rule this testsRate of return and CAGR
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