Find the compound interest on Rs.1000 at 20% for 2 years.
Explanation
The complete calculation confirms 440 as the correct option. For this question, identify every monetary base before applying a percentage. The question-specific working supplied in the record is: This compound interest solved example uses the step-by-step formula A = P(1 + R/100)^n, a reliable shortcut trick for annual compounding. Substituting P = 1000, R = 20, and n = 2 gives A = 1000(1.20)^2 = 1440. Compound interest equals amount minus principal, so CI = 1440 − 1000 = 440. The extra ₹40 arises from interest earned on the first year's ₹200 interest. Therefore, ₹440 is correct, matching option C.. The distractors 460, 400, 420 can result from interchanging cost price and selling price, treating discount as loss, adding successive rates, ignoring quantity, or rounding before the final step. This method preserves the numerical relationships in the stem and develops formula selection, percentage-base recognition and option elimination for SSC, Railway, Banking and other competitive aptitude examinations.