Question
What does Rs. 250 amounts to in 2 years with compound interest at the rate of 4% in the 1st year and 8% in the second year ?
Answer: Option B
$$\eqalign{
& {\text{Principal = Rs 250}} \cr
& {{\text{R}}_1} = 4\% ,\,\,\,\,\,\,\,\,\,{{\text{R}}_2} = 8\% \cr
& {\text{Amount}}\,{\text{after}}{1^{st}}\,{\text{year}} \cr
& = 250\left( {1 + \frac{4}{{100}}} \right) = {\text{Rs}}{\text{. }}260 \cr
& {\text{Amount after }}{{\text{2}}^{{\text{nd}}}}{\text{ year}} \cr
& {\text{ = }}260\left( {1 + \frac{8}{{100}}} \right) \cr
& = {\text{Rs}}{\text{. }}280.80 \cr} $$
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$$\eqalign{
& {\text{Principal = Rs 250}} \cr
& {{\text{R}}_1} = 4\% ,\,\,\,\,\,\,\,\,\,{{\text{R}}_2} = 8\% \cr
& {\text{Amount}}\,{\text{after}}{1^{st}}\,{\text{year}} \cr
& = 250\left( {1 + \frac{4}{{100}}} \right) = {\text{Rs}}{\text{. }}260 \cr
& {\text{Amount after }}{{\text{2}}^{{\text{nd}}}}{\text{ year}} \cr
& {\text{ = }}260\left( {1 + \frac{8}{{100}}} \right) \cr
& = {\text{Rs}}{\text{. }}280.80 \cr} $$
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