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An investor invested a sum of ₹ 12 lakhs in Company P in 1998. The total amount received after one year was re-invested in the same Company for one more year. The total appreciation received by the investor on his investment was? |
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Answer: Option C Explanation: Amount received from Company P after one year (i.e., in 199) on investing ₹ 12 lakhs in it = ₹ [12 + (8% of 12)] lakhs = ₹ 12.96 lakhs. Amount received from Company P after one year on investing ₹ 12.96 lakhs in the year 1999 = ₹ [12.96 + (10% of 12.96)] lakhs = ₹ 14.256. Appreciation received on investment during the period of two years = ₹ (14.256 - 12) lakhs = ₹ 2.256 lakhs = ₹ 2,25,600. |
Two different finance companies declare fixed annual rate of interest on the amounts invested with them by investors. The rate of interest offered by these companies may differ from year to year depending on the variation in the economy of the country and the banks rate of interest. The annual rate of interest offered by the two Companies P and Q over the years are shown by the line graph provided below.
Annual Rate of Interest Offered by Two Finance Companies Over the Years.
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