Question

Mohan invested Rs. 10,000 in a company for 3 years and get back Rs. 13310, what was the compound interest payable annually?

Answer 1

Consider the problem

We have,

Amount, $A=RS13,310$

Principal, $P=RS10,000$

Time $n=3years$

Compound rate of interest, $r=?$

We know that

$A=P{\left(1+\frac{r}{100}\right)}^n$

So,

$\begin{array}{c}13310=10000{\left(1+\frac{r}{100}\right)}^3\\ \frac{13310}{10000}={\left(1+\frac{r}{100}\right)}^3\\ \frac{1331}{1000}={\left(1+\frac{r}{100}\right)}^3\\ {\left(\frac{11}{10}\right)}^3={\left(1+\frac{r}{100}\right)}^3\\ \left(\frac{11}{10}\right)=\left(1+\frac{r}{100}\right)\\ \frac{r}{100}=\frac{11}{10}-1\\ \frac{r}{100}=\frac{1}{10}\end{array}$

$r=10\%$