At what rate of compound interest per annum will a sum of ₹10000 become ₹12321 in 2 years?
- A22 percent
- B11 percent
- C7 percent
- D15 percent
Solution & Step-by-step Explanation
The formula for the amount under compound interest is:
A=P(1+
100
R
)
t
Given:
A=12321
P=10000
t=2 years
Substitute the values into the formula:
12321=10000(1+
100
R
)
2
10000
12321
=(1+
100
R
)
2
Taking the square root on both sides:
10000
12321
=1+
100
R
Since
12321
=111 and
10000
=100:
100
111
=1+
100
R
1.11=1+
100
R
100
R
=1.11−1=0.11
R=0.11×100=11%
A=P(1+
100
R
)
t
Given:
A=12321
P=10000
t=2 years
Substitute the values into the formula:
12321=10000(1+
100
R
)
2
10000
12321
=(1+
100
R
)
2
Taking the square root on both sides:
10000
12321
=1+
100
R
Since
12321
=111 and
10000
=100:
100
111
=1+
100
R
1.11=1+
100
R
100
R
=1.11−1=0.11
R=0.11×100=11%