Question

In what time will $Rs.5,400$ amount to $Rs.6,773.76$ at $12$ per annum compound interest?

Answer 1

Amount, $A=P{(1+\frac{R}{100})}^n$

In the above formula: R - Rate of Interest, n is no. of years, P is the principal amount and A is the amount received after n years.

Substituting the given values in the above formula to calculate n:

$6773.76=5400{(1+\frac{12}{100})}^n$

${\left(\frac{112}{100}\right)}^n=\frac{6773.76}{5400}$

$(1.12{)}^n=1.2544$

$(1.12{)}^n=(1.12{)}^2$

Comparing the powers of LHS and RHS when the base is same;

$\text{n=2}$ Ans.

Hence, the amount of Rs. 5400 will become Rs. 6773.76 in $\text{2 years}$ with the given rate of interest.