Compound interest earned on a sum for the second and the third years are Rs.1200 and Rs.1440 respectively. Find the rate of interest?

A. 18% p.a.
B. 22% p.a.
C. 20% p.a.
D. 24% p.a.
E. None of these.

Explanation:

Rs.1440 – 1200 = Rs.240 is the interest on Rs.1200 for one year.

Rate of interest = (100 * 240) / (100 * 1) = 20% p.a

Correct Answer: 20% p.a. ✔

Last Updated: February 07, 2020