Question 160

The compound interest accrued in 2 years on a principal of Rs. 15,800 is Rs.7716.72. What is the rate of interest p.c.p.a. ?

Solution

Amount = 15800 + 7716.72 = Rs. 23,516.72

$$A = P (1 + \frac{R}{100})^T$$

=> $$23,516.72 = 15,800 (1 + \frac{R}{100})^2$$

=> $$\frac{23,516.72}{15,800} = (1 + \frac{R}{100})^2$$

=> $$\frac{14884}{10000} = (1 + \frac{R}{100})^2$$

=> $$(1 + \frac{R}{100})^2 = (\frac{122}{100})^2$$

=> $$1 + \frac{R}{100} = \frac{122}{100}$$

=> $$\frac{R}{100} = \frac{122}{100} - 1$$

=> $$\frac{R}{100} = \frac{22}{100}$$

=> $$R = 22 \%$$

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