There is 60% increase in an amount in 6 years at simple interest. What will be the compound interest of Rs. 12,000 after 3 years at the same rate?

A. Rs. 2972

B. Rs. 3120

C. Rs. 3972

D. Rs. 4120

View Answer

Correct Answer :
Rs. 3972

Explanation :

Let P = Rs. 100. Then, S.I = Rs. 60 and T = 6 years

=> R = [ (100 x 60) / (100 x 6) ] = 10% p.a

Now, P = Rs. 12000. T = 3 years and R = 10% p.a

=> C.I = Rs. [ 1200 x { (1 + 10 / 100)³ - 1 } ]

=> C.I = Rs. [ 12000 x (331 / 1000) ]

=> C.I = Rs. 3972

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