CA Foundation · Quantitative Aptitude · Mathematics of Finance
Rohit deposits ₹1,000 at the beginning of each quarter for 2 quarters in a scheme paying 8% per annum compounded quarterly. What is the amount at the end of the second quarter?
The amount is ₹2,060.40. The quarterly rate is 2%, and deposits are made at the start of each quarter. The first grows to ₹1,040.40 and the second to ₹1,020, giving a total of ₹2,060.40 at the end of the second quarter.
- A₹2,020.00
- B₹2,060.40Correct
- C₹2,080.00
- D₹2,246.40
Explanation
The quarterly rate is 8%/4 = 2%. The first deposit earns two quarters: 1,000 × 1.02² = 1,040.40. The second earns one quarter: 1,000 × 1.02 = 1,020. The total is ₹2,060.40. ₹2,020 treats the deposits as made at quarter-end, and ₹2,246.40 wrongly uses 8% per quarter.
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