Question

Find the sum that will amount to $Rs55125$ in two years at $5\%$ per annum compound interest.

Answer 1

$A=$ Rs $55125$$,r=5$$,n=2$yrs.

Now, $A=P{\left[1+\frac{r}{100}\right]}^n$

$\Rightarrow 55125=P{\left[1+\frac{5}{100}\right]}^2$

$\Rightarrow 55125=P{\left[1+\frac{1}{20}\right]}^2$

$\Rightarrow 55125=P{\left(\frac{21}{20}\right)}^2$

$\Rightarrow P=55125\times \frac{400}{441}$

$\Rightarrow P=125\times 400$

$\Rightarrow P=$ Rs $5000$