Find the compound interest earned on Rs. 60,000 for 2 years at the rate of 5 percent per annum.

Correct option is B

Given:
Rate = 5%
Amount = Rs. 60,000
Time = 2 years
Formula Used:
For Compound Interest,
​$$A = P \left\{1 + \frac{R}{100} \right\}^n \\$$​​
Solution:
​$$A = P \left\{1 + \frac{R}{100} \right\}^n \\\Rightarrow A = 60000 \left\{1 + \frac{5}{100} \right\}^2 \\\Rightarrow A = 60000 \left\{1 + \frac{1}{20} \right\}^2 \\\Rightarrow A = 60000 \left( \frac{21}{20} \right)^2 \\\Rightarrow A = \text{Rs. } 66150 \\A = P + \text{CI} \\\Rightarrow \text{CI} = A - P \\\Rightarrow \text{CI} = 66150 - 60000 \\\Rightarrow \text{CI} = \text{Rs. } 6150 \\\therefore \text{The compound interest is Rs. } 6150.$$​​
Alternate Solution:
CI for 1st year 5% of 60000 = 3000
Amount = 63000
CI for next year = 5% of 63000 = 3150
Amount = 66150
CI for 2 years = 66150 - 60000 = Rs.6150