The principal increases continuously in a newly opened bank at the rate of 10 % per year. An amount of Rs. 2000 is deposited with this bank. How much will it become after 5 years? (e^ 0.5 =1.648 )

Step-by-step solution

Continuous compounding applies the formula A = P e^ rt , where P = 2000 , r = 0.10 , and t = 5 . Evaluating the exponent gives rt = 0.50 , so A = 2000 e^ 0.5 . Using the given e^ 0.5 = 1.648 , calculate A = 2000 1.648 = 3296 . Among the options, 3296 corresponds to B, so the answer is B .