Q2 Explain about the doubling period and future value. Solve the below given problem:
Under the ABC Bank’s Cash Multiplier Scheme, deposits can be made for periods ranging from 3 months to 5 years and for every quarter, interest is added to the principal. The applicable rate of interest is 9% for deposits less than 23 months and 10% for periods more than 24 months. What will be the amount of Rs. 1000 after 2 years?
Explanation of doubling period
Solving the problem
Explanation of future value
Answer: Doubling period
Doubling period is the period which makes the investment as “Doubled”, that is the amount invested fetches 100% return.