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A sum amounts to Rs. 1210 in 2 years when invested at compound interest. If principal is Rs. 1000, then what is the rate of interest (in %)?1). 102). 203). 154). 12 |
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Answer» S = P + C Where C = COMPOUND interest P = Principal r = rate n = number of period S = sum after n periods In 2 YEARS, P = 1000 S = 1210 ⇒ P + C = 1210 ⇒ 1000 + C = 1210 ⇒ P[(1 + r/100)n - 1] = 210 ⇒ 1000 × [(1 + r/100)2 – 1] = 210 ⇒ (1 + r/100)2 - 1= 0.210 ⇒ (1 + r/100)2 = 1.21 ⇒ r/100 = (1.21)1/2 - 1 = 1.1 - 1 = 0.1 ⇒ r = 10% |
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