1.

2000 rupees was deposited in a scheme in which interest is compounded annually. After two years the amount in the account was 2205 rupees. What is the rate of interest?

Answer»

Amount (P) = 2000

Compound interest (r %) Year (n)

\(P(1+\frac{r}{100})^n=A;\) \(2000(1+\frac{r}{100})^2=2205\)

\((1+\frac{r}{100})^2=\frac{2205}{2000}=\frac{441}{400}\)

\((\frac{100+r}{100})=\frac{21}{20};\) \(100+r=\frac{21\times100}{20}=\frac{2100}{20}\)

r = 105 - 100 = 5

Interest rate = 5%



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