Question:
Seema invested an amount of Rs. 16,000 for two years on compound interest and received an amount of Rs. 17,640 on maturity. What is the rate of interest ?
Seema invested an amount of Rs. 16,000 for two years on compound interest and received an amount of Rs. 17,640 on maturity. What is the rate of interest ?
Updated On: Sep 25, 2024
- 5 pcpa
- 8 pcpa
- 4 pcpa
- Data inadequate
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The Correct Option is A
Solution and Explanation
The formula for Amount(A) is
Amount (A) = (P) Principal \(\times[1-\frac{r}{100}]^n\)
Now putting the values given in the question to the equation, we get
17640 = 16000\(\times[1-\frac{r}{100}]^2\)
On solving the equation, we get
\(r=\) 0.05 = 5\(\%\)
So, the Rate of interest = 5\(\%\) per annum
The correct option is (A)
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