Question

If rs. 500 amounts to rs. 583.20 in two years compounded annually, find the rate of interest per annum?

Answer 1

answer is 10% per annum

Answer 2

Answer:

8%

Step-by-step explanation:

Principal = Rs .500

Amount = rs. 583.20

Time t = 2 years

n = no. of compounds per year = 1

Formula : $A=P(1+\frac{r}{n})^{nt}$

Substitute the values.

$583.20=500(1+\frac{r}{1})^{2}$

$\frac{583.20}{500}=(1+\frac{r}{1})^{2}$

$1.1664=(1+\frac{r}{1})^{2}$

$\sqrt{1.1664}=1+r$

$1.08=1+r$

$0.08=r$

So, rate of interest in decimal = 0.08

Rate of interest in percent =  0.08 * 100 = 8%