Question

How many time will an amount grow in 2 years at the compound interest rate of 05% per annum? ? | a) 2, b) 2(1/4) (c) 2(1/2), d)2 (3/4)​

Answer 1

Answer:

GIVEN:

Time(n) = 2 years, Rate(R) = 5% per annum and Interest(I) = Rs205

FORMULA USED:

A = P (1 + R/100)n

Where A → Amounts → (Principal + Interest),

P → Principal

R → Rate per annum

n → Number of years

Simple Interest (S.I) = P × R × T/100

CALCULATION:

A = P (1 + R/100)n

⇒ (P + 205) = P (1 + 5/100)2

⇒ (P + 205) = P (1 + 1/20)2

⇒ (P + 205) = P × 21/20 × 21/20

⇒ P + 205 = 441P/400

⇒ 205 = - P + 441P/400

⇒ 205 = 41P/400

⇒ P = Rs 2000

Simple Interest (S.I) = P × R × T/100

⇒ S.I = 2000 × 5 × 2/100

∴ Simple Interest is Rs200.