Question

5000 amounts to 6050 in 2 yrs at compound interest..what is the rate...?

Answer 1

Principal= 5000
Rate = ?
Time= 2 years
Amount= 6050

Amount = P(1+Rate%/100)n

6050=5000(1+Rate/100)²

6050/5000=(100+R/100)²

(6050/5000 divided by 5 so we get 1210 and 1000 {0 cancel from numerator and denominator})

(121/100) = (100+R/100)²

(121 and 100 are the square of 11 and 10

(11/10)²= (100+R/100)²

( Powers are same so It cancel while comparing )

11/10=100+R/100

11(100)=10(100+R)
11(100)=1000+10R

1100-100=10R
100/10=R
Rate=10%