# Rekha deposited Rs 16000 in a foreign bank which pays interest at the rate of 20% per annum compounded quarterly,

Question:

Rekha deposited Rs 16000 in a foreign bank which pays interest at the rate of 20% per annum compounded quarterly, find the interest received by Rekha after one year.

Solution:

Given:

$\mathrm{P}=\mathrm{Rs} 16,000$

$\mathrm{R}=20 \%$ p. a.

$\mathrm{n}=1$ year

We know that:

$\mathrm{A}=\mathrm{P}\left(1+\frac{\mathrm{R}}{100}\right)^{\mathrm{n}}$

When compounded quarterly, we have :

$\mathrm{A}=\mathrm{P}\left(1+\frac{\mathrm{R}}{400}\right)^{4 \mathrm{n}}$

$=\operatorname{Rs} 16,000\left(1+\frac{20}{400}\right)^{4}$

$=\operatorname{Rs} 16,000(1.05)^{4}$

$=\operatorname{Rs} 19,448.10$

Also,

$\mathrm{CI}=\mathrm{A}-\mathrm{P}$

$=\mathrm{Rs} 19,448.1-\mathrm{Rs} 16,000$

$=\mathrm{Rs} 19,448.1-\mathrm{Rs} 16,000$

$=\mathrm{Rs} 3,448.10$

Thus, the interest received by Rekha after one year is Rs $3,448.10$.
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