Maths-
General
Easy

Question

At what rate % p.a will a sum of  Rs4000 yield 1324 as compound interest in 3 yrs
 

hintHint:

Use the formula of compound interest to get the rate of interest.

The correct answer is: 10%


    Complete step by step solution:
    We know that compound interest = Total amount - principal amount that is, CI = A - P …(i)
    We know that A equals P open parentheses 1 plus R over 100 close parentheses to the power of T…(ii)
    Here, we have T = 3 years, P = 4000 and    R = ?
    On substituting the known values in (ii), we get A equals 4000 open parentheses 1 plus R over 100 close parentheses cubed
    Given that CI = 1324,
    On substituting the known values in (i), we get 1324 equals 4000 open parentheses 1 plus R over 100 close parentheses cubed minus 4000
    On adding 4000 on both the sides, we have 5324 equals 4000 open parentheses 1 plus R over 100 close parentheses cubed
    Divide on both sides by 4000.
    On dividing we have, 5324 over 4000 equals 4000 over 4000 open parentheses 1 plus R over 100 close parentheses cubed

    not stretchy rightwards double arrow 1331 over 1000 equals open parentheses 1 plus R over 100 close parentheses cubed

    not stretchy rightwards double arrow open parentheses 11 over 10 close parentheses cubed equals open parentheses 1 plus R over 100 close parentheses cubed

    not stretchy rightwards double arrow 11 over 10 equals 1 plus R over 100
    not stretchy rightwards double arrow R equals 10 straight percent sign
    So, at 10% pa per annum will a sum of Rs 4000 yield 1324 as compound interest in 3 years.

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