Short Answer 
The final amount after 10 years of a 1,000 Rs investment at a 4% annual interest rate compounded quarterly is 1488.86 Rs, resulting in a compound interest of 488.86 Rs.
Step 1: Understand the Compound Interest Formula
To calculate the compound interest, we will use the formula: A = P(1 + frac{r}{n})^{nt}. In this equation:
- P represents the Principal amount (initial investment).
- r is the Annual Interest Rate (as a decimal).
- n is the number of times interest is compounded per year.
- t is the number of years the money is invested or borrowed.
Step 2: Define the Investment Variables
Now, we will input our investment details into the formula. Our specific values are:
- P = 1,000 Rs (the initial amount).
- r = 0.04 (which is 4% expressed as a decimal).
- n = 4 (because the interest is compounded quarterly).
- t = 10 years (the duration of the investment).
Step 3: Calculate the Total Amount and Difference
We substitute our values into the compound interest formula:
- The calculation is A = 1000(1 + frac{0.04}{4})^{40}.
- This simplifies to A = 1000(1.01)^{40}, which equals 1488.86 Rs.
- To find the Compound Interest (CI), we subtract the principal: CI = A – P.
- Thus, CI = 1488.86 – 1000 = 488.86 Rs showing the growth over the 10 years.