Question

A certain sum of money at compound interest becomes 7396 in two years and 7950.70 in three years .Find the rate of intrest

Answer 1

Answer: Rate is 7.5% and Amount is 6400

Step-by-step explanation:

Amount in 3 years = 7950.70

Amount in 2 years= 7396.00

Interest for 3rd year =554.70

Principal for 3rd year=7396

Time = 1 year

Rate = (Interest *100)/ Principal*Time

= 554.70*100 / 7396* 1

= 55470 / 7396 = 7.5%

Let sum of money = x

Amount = 7396

Time = 2 years

then Amount = Principal(1+R/100)^T

7396 = x (1+7.5/100)^2

x =7396 /(43/40)^2

=7396 *40*40 /43*43

=6400

(Not specified the currency since not specified in question)