What will be the compound interest on ` 4,000.00 for 2 years at the rate of 5% Per annum ?

The correct answer is (c) `421.

The compound interest is calculated by using the following formula:

$C.I. = P(1 + r/n)^nt$

where:

• $C.I.$ is the compound interest
• $P$ is the principal amount
• $r$ is the interest rate
• $n$ is the number of times interest is compounded per year
• $t$ is the number of years

In this case, we have:

• $P = 4000$
• $r = 5\%$
• $n = 2$
• $t = 2$

Substituting these values into the formula, we get:

$C.I. = 4000(1 + 0.05/1)^2(2)$

$C.I. = 4000(1.05)^4$

$C.I. = 421.04$

Therefore, the compound interest on 4,000.00 for 2 years at the rate of 5% Per annum is421.