Question

At what principal amount the compound interest will become Rs. 1261 at 5% per annum after 3 years?

Answer 1

We know that compound interest = $CI=A-P$

$CI=P(1+\frac{r}{100}{)}^t-P$

$1261=P\left[\right(1+\frac{5}{100}{)}^3-1]$

$1261=P(1.1576-1)=P\left(0.1576\right)$

$P=8001.25Rs.$