Question

At what rate % p.a. will a sum of Rs. 4000 yield Rs. 1324 as compound interest in 3 years?

Answer 1

P = Rs. 4000, C.I. = Rs. 1324, n = 3 years
Amount, A = P + C.I. = Rs. 4000 + Rs. 1324 = Rs. 5324

${\displaystyle A=P{(1+\frac{r}{100})}^n}$

${\displaystyle \Rightarrow 5324=4000{(1+\frac{r}{100})}^3}$

${\displaystyle \Rightarrow {(1+\frac{r}{100})}^3=\frac{5324}{4000}=\frac{1331}{1000}}$

${\displaystyle \Rightarrow {(1+\frac{r}{100})}^3={\left(\frac{11}{10}\right)}^3}$

${\displaystyle \Rightarrow 1+\frac{r}{100}=\frac{11}{10}}$

${\displaystyle \Rightarrow \frac{r}{100}=\frac{11}{10}-1=\frac{1}{10}}$

${\displaystyle \Rightarrow r=10\%}$