Question

If the compound interest on a certain sum at 25% for 2 years is Rs.900, Find the principal.

Answer 1

C.I for  2 years = 900
C.I = A - P
      = P[(1 + r/100)^n] - P
900 = P[(1 + 25/100)^2] - P
900 = P[(5/4)^2] - P
900 = 25P/16 - P =  25P-16P/16 = 9P/16
P = 900*16/9 = 1600
Hence, Principal = Rs.1600
Hope it helps.