Question

A certain sum amounts to 6842 in 2 years at 8% per annum compound interest, interest being
compounded annually. Find the sum.​

Answer 1

Answer:

The sum is Rs.5865.91

Step-by-step explanation:

P = initial amount = ?

R = rate of interest per cent per year = 8

T = time period in years = 2

A = final amount at the end of T years = 6842

Using formula for compound interest (annual compounding), we get:

A = P(1 + R/100)^T

6842 = P(1 + 8/100)^2

6842 = P(1 + 0.08)^2

6842 = P(1.08)^2

P = 6842 / [(1.08)^2]

P = 6842 / 1.1664

P = 5865.91  (approx)

The sum is Rs.5865.91