Calculate total interest earned if an amount of INR 8000 is divided into two parts. 40% of the amount is compounded at a 20% p.a. rate of interest for two years and 60% earns simple interest at the same rate for the same years.
1. Rs. 3328
2. Rs. 4208
3. Rs. 3764
4. Rs. 4586
1. Rs. 3328
2. Rs. 4208
3. Rs. 3764
4. Rs. 4586
Correct Answer – Option 1 : Rs. 3328
Given:
Rate of interest = 20%
Years = 2
Principal amount = 8000
Formula used:
Simple interest: (P × R × T) / 100
Compound interest: Amount = P (1 + (R/100))n
Where, n = Number of years, P = Principal Amount, R = Rate of Interest, A = Amount
Calculations:
Here, 40% of amount is compounded
⇒ P for C.I. = (40 / 100) × 8000
⇒ P for C.I. = 3200
⇒ 3200 × (1 + (20 / 100))2
⇒ 3200 × (6 / 5)2
⇒ 3200 × 36 / 25
⇒ 4608
⇒ Interest earned = 4608 – 3200
⇒ I = 1408
Now,
⇒ 60% of amount = 8000 – 3200
⇒ P for S.I. = 4800
⇒ 4800 × 20 × 2 / 100
⇒ I = 1920
∴ Total interest earned is Rs. 3328