Question

Calculate the principal that at the rate of 5% compound interest per annum becomes Rs.615 after 2 years.

Answer 1

Given :

• Rate of interest (r) = 5%
• Time (n) = 2 years.
• Compound interest (CI) = Rs.615

To find :

• Principal (P) = ?

Solution :

As we know the formula :

☛ CI = P(1 + r/100)ⁿ - P

Putting values :

⇒ 615 = P [(1 + r/100)ⁿ - 1]

⇒ 615 = P [(1 + 5/100)² - 1]

⇒ 615 = P [(1 + 0.05)² - 1]

⇒ 615 = P [(1.05)² - 1 ]

⇒ 615 = P [1.1025 - 1]

⇒ 615 = P × 0.1025

⇒ 615 = 0.1025P

⇒ P = 615/0.1025

⇒ P = 6,000

Therefore,

Sum of money or principal = Rs. 6,000 .

More formulas :

• Simple interest = (P × r × n)/100
• On the first year, SI = CI [@ Same rate & Same principal ]

Answer 2

Answer:-

Given:

Rate of interest (R) = 5 %

Time (T) = 2 years

Compound interest = Rs. 615

Let , Principle = P.

We know that,

Compound Interest = P(1 + R/100) ^ T - P

→ 615 = P(1 + 5/100)² - P

→ 615 = P[(100 + 5)/100]² - P

→ 615 = P(105/100)² - P

→ 615 = P(21/20)² - P

→ 615 = P(441/400) - P

→ 615 = (441P - 400P)/400

→ 615*400 = 41P

→ P = (615*400)/41

→ P = Rs. 6000.

Hence, the principal is Rs. 6000.