Question

Find the rate of interest if the interest Rs.1323 is earned on Rs.4200 for 3.5 years?

Answer 1

Compound interest accumulation factor :

P(1 + i)ⁿ = Amount

P. = 4200

i = interest

n = 3.5 years

Amount = 4200 + 1323 = 5523

4200(1 + i)^3.5 = 5523

(1 + i)^3.5 = 1.315

1 + i = (1.315)^1/3.5

1 + i = 1.081381

i = 1.081381 - 1

i = 0.081381

i = 0.081381 × 100

i = 8.1381%