What is the principal amount which earns Rs. 464 as compound interest

1.	What is the principal amount which earns Rs. 464 as compound interest for the second year at 16% per annum?1. Rs. 32002. Rs. 28003. Rs. 27004. Rs. 2500
Answer» Correct Answer - Option 4 : Rs. 2500 Given: Compound interest for the second year = Rs. 464 Rate (R) = 16% Formula used: A = P(1 + R/100)n Where A → amount P → principal R → rate n → time Calculations: Let the principal be Rs. P. According to the question, Amount after 1st year = P × 29/25 = 29P/25 Amount after 2nd year = (29P/25) × (29/25) = (841P/625) So, Compound interest for the second year = (841P/625) – 29P/25 ⇒ (841P – 725P)/625 ⇒ 116P/625 But Compound interest for the second year = Rs. 464 Thus (116P/625) = 464 ⇒ P = 2500 ∴ The Principal is Rs. 2500.

What is the principal amount which earns Rs. 464 as compound interest for the second year at 16% per annum?1. Rs. 32002. Rs. 28003. Rs. 27004. Rs. 2500

Answer» Correct Answer - Option 4 : Rs. 2500

Given:

Compound interest for the second year = Rs. 464

Rate (R) = 16%

Formula used:

A = P(1 + R/100)n

Where A → amount

P → principal

R → rate

n → time

Calculations:

Let the principal be Rs. P.

According to the question,

Amount after 1st year = P × 29/25 = 29P/25

Amount after 2nd year = (29P/25) × (29/25) = (841P/625)

So, Compound interest for the second year = (841P/625) – 29P/25

⇒ (841P – 725P)/625

⇒ 116P/625

But Compound interest for the second year = Rs. 464

Thus (116P/625) = 464

⇒ P = 2500

∴ The Principal is Rs. 2500.

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