Question

Compound interest for a certain sum of money for two years at 10 % per annum is ₹315. Find the initial amount.

• A. ₹ 1500
• B. ₹ 1000
• C. ₹ 1500
• D. ₹ 1200

Answer 1

The correct option is C ₹ 1500

Given: I = ₹315 ; r = 10 % and n = 2 years

Let the Sum of the money be P

A = P$(1+\frac{r}{100}{)}^2$

I = A - P

Hence $I=P(1+\frac{r}{100}{)}^2-P315=P(1+\frac{r}{100}{)}^2-P315=P(1+\frac{10}{100}{)}^2-P315=P(\frac{11}{10}{)}^2-P315=\frac{121P}{100}-P315=P(\frac{121}{100}-1)315=\frac{21P}{100}$

$P=\frac{315\times 100}{21}=\frac{105\times 100}{7}=₹1500$

Therefore, the initial amount = ₹ 1500