Question

You are scheduled to receive Rs. 15,000 in two years. When you receive it, you will invest it for six more years at 8 percent per year. How much will you have in eight years?

Answer 1

Amount after 8 years is Rs. 23803.12

Step-by-step explanation:

The amount received in two years = Rs 15000

It is given that the amount received in two years is invested for six years that earns the interest rate of 8% per year. Now, we have to find the total amount after eight years. Here, in the first two years, there is no interest rate earned. So only six years will be used to count the interest rate.

Amount after 8 years = Present value (1 + r)^n

Amount after 8 years = 15000 (1 + 8%)^6

Amount after 8 years = 15000 (1 + 0.08)^6

Amount after 8 years = 23803.12