By Poonam

Verified by Ajay Kumar

A savings scheme offers compound interest annually. A woman deposits ₹10,000. At the end of the first year, the interest rate is 10%. In the second year, due to inflation, the interest rate rises to 12.5%, and in the third year, it drops to 8%. Calculate the total interest she earned at the end of 3 years.

  1. ₹3,265

  2. ₹3,365

  3. ₹3,285

  4. ₹3,460

Answer: B

Solution

Final amount = \(10000 \times 1.10 \times 1.125 \times 1.08 = 13365\). Total interest = \(13365 - 10000 = 3365\). The total interest is ₹3,365.

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