Rs. 62,500 amounts to Rs. 67,600 in 6 months when interest is compounded quarterly. What is the annual rate of interest?
Correct answer A. 16%
Explanation
67600/62500 = 1.0816 = (1.04)², i.e. 4% per quarter for 2 quarters, so the annual rate = 4 × 4 = 16%.
Answer checked How we write and check questions
Discussion