Question

During a period of two years, a principal of Rs. 100 amounts to Rs. 121 at the annual compound rate of r%. The value of $r$ will be

• A. $9$
• B. $10$
• C. $\frac{21}{2}$
• D. $11$

Answer 1

Answer: (B)

$10$

Given, Sum (P) $=$ Rs. 100,
Amount due (A) $=$ Rs. 121,
Time (n) $=$ 2 years, Rate (r) $=$ ?
We know
$A=P{(1+\frac{r}{100})}^n$
$\therefore 121=100(1+\frac{r}{100}{)}^2$
or $(1+\frac{r}{100}{)}^2=\frac{121}{100}$
or $1+\frac{r}{100}=\frac{11}{10}=1+\frac{1}{10}=1+\frac{10}{100}$
$\therefore r=10\%$