Question

At what rate per cent per annum will a sum of $Rs.7500$ amount to $Rs.8427$ in $2$ years compounded annually?

• A. $4$%
• B. $5$%
• C. $6$%
• D. $8$%

Answer 1

The correct option is C $6$%

We have,

$P=7500Rs$

$A=8427Rs$

$T=2$ years

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

$7500+8427=7500{(1+\frac{R}{100})}^T$

$\frac{8427}{7500}={(1+\frac{R}{100})}^2$

$(1+\frac{R}{100})=\frac{2809}{2500}=\left(\frac{53}{50}\right)$

$(1+\frac{R}{100})=\frac{53}{50}-1$

$\frac{R}{100}=\frac{53}{50}-1$

$R=\frac{3}{50}$

$R\%=6\%$

Hence, this is the answer.