Question

A sum is invested on compound intrest compounded annually. The interest in first two years were
$1.000 and $1.080. What is the principal amount?​

Answer 1

Step-by-step explanation:

Simple interest on Rs 400 for 1 year = 420-400= Rs 20

Rate =

PT

100×SI

=

400×1

100×80

=5%

Rs 400 is the intrest on the sum for 1st year

Hence, sum =

RT

100×S.T

=

5×1

100×400

=Rs8000

solution