Question

A merchant commences with a certain capital and gains annually at the rate of 25% at the end of 3 years he is worth rs.10000.what was his original capital

Answer 1

Let the principle for the first year be Rs "x".

S.I for 1st year = (x * 25 * 1)/100 = x/4.

Amount = x + x/4 = 5x/4

SI for 2nd year = (5x/4 * 25 * 1)/100 = 5x/16

Amount = 5x/4 + 5x/16 = 25x/16.

SI for 3rd year = (25x/16 * 25 * 1)/100 = 25x/64.

Amount = 25x/16 + 25x/64 = 125x/64.

Acc to the question, 125x/64 =  10,000

or, x =  (10,000 * 64) / 125

or, x = 640000/125 = 5120.

Therefore, the original capital was Rs 5120. [Ans]