Question

A principal amounts to ₹13924 in 2 years by compound interest at 18 p.c.p.a. Find the principal.

Answer 1

Here, P = Principal
A = ₹ 13924
R = 18 %
N = 2 years

$$\begin{gathered} \mathrm{A}=\mathrm{P}{\left(1+\frac{\mathrm{R}}{100}\right)}^{\mathrm{N}} \\ \Rightarrow 13924=\mathrm{P}{\left(1+\frac{18}{100}\right)}^2 \\ \Rightarrow 13924=\mathrm{P}{\left(1+\frac{9}{50}\right)}^2 \\ \Rightarrow 13924=\mathrm{P}{\left(\frac{59}{50}\right)}^2 \\ \Rightarrow \mathrm{P}=\frac{13924\times 50\times 50}{59\times 59} \\ \Rightarrow \mathrm{P}=10000 \end{gathered}$$

Hence, the principal is ₹ 10000.