Question

A borrowed * 2,500 from B at 12% per
annum compound interest. After 2 years, A
gave 2,936 and a watch to B to clear the
account. Find the cost of the watch.​

Answer 1

N=2 years

R=12 %

=>P=Rs2,500

And on interest being compounded we have,

Amount=

$P(1 + \frac{R}{100} {)}^{N} =2,500×(1+ \frac{12}{100} {)}^{2} =2,500×{1.12}^{2} </p><p></p><p>=Rs3,136$

Given, 3,136=2,936+ Cost of the watch

Cost of the watch = Rs 200