A man gets a simple interest of Rs. 1,000 on a certain principal at the rate of 5 p.c.p.a. in 4 years. What compound interest will the man get on twice the principal in two years at the same rate ?
A). Rs. 1325
B). Rs. 1225
C). Rs. 1125
D). Rs. 1025
Rs. 1025
Principal = SI x 100/Time x Rate
= 1000 x 100/4 x 5
= Rs. 5000
Case II
Principal = Rs. 10000
Therefore CI = P [(1 + Rate/100)Time -1]
= 10000 [(1 + 5/100)² -1]
= 10000 x [(21/20)² -1]
= 10000 x 41/400
= Rs. 1025