At what rate per annum will a sum of `12000 yield compound interest of `1230 for 2 years?
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Answer:
5% per annum
Step-by-step explanation:
Let the Rate percent be R.
Principal (P) = ₹12000
Compound Interest (CI) = ₹1230
Amount (A) = P + CI = ₹12000 + ₹1230 = ₹13230
Time (n) = 2 years
A = P (1 + R/100)ⁿ
=> 13230 = 12000 (1 + R/100)²
=> 1323/1200 = (1 + R/100)²
=> 441/400 = (1 + R/100)²
=> (21/20)² = (1 + R/100)²
=> 21/20 = 1 + R/100
=> 21/20 - 1 = R/100
=> 1/20 = R/100
=> R = 5%
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