Question

Find the rate of interest at which, a sum of money becomes 9/4 times in 2 years.

Answer 1

we consider it as simple interest.
let principal be rs P rate be r% ,amount =rs
9P/4 so,SI= rs(9P/4-P) =rs ( 5P/4)
5P/4=(P×r×2)/100
or, 5/4=r/50
or,r=62.5 %(ans)
IF THE INTEREST BEING PAID COMPOUNDED ANNUALLY... THEN
9P/4=P×(1+r/100)^2
or,9/4=(1+r/100)^2
or,3/2=1+r/100 (taking square root ln both sides) so r=50 sorate of interest 50%(ans)



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