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At what rate of compound interest per annum will a sum of Rs. 2000 becomes Rs. 2508.8 in 2 years?1). 24 percent2). 8 percent3). 12 percent4). 16 percent |
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Answer» The formula for amount payable at annual compound interest, INCLUDING principal sum, is: $(A = P{\left( {1 + \frac{r}{{100 \times N}}} \right)^{nt}})$ Where: A = Amount P = the principal INVESTMENT amount (the initial deposit or loan amount) r = the annual interest rate (decimal) n = the NUMBER of times that interest is compounded PER year t = the number of years the money is invested or borrowed for Here n = 1 Let the rate be r% 2508.8 = 2000 (1 + r/100)2 r = 12% |
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