Question

Using the ready reckoner, find the period of interest for compound interest $Rs.4026$ at $7\%$ p.a. on the principal $Rs.10,000$.

Answer 1

Given : $P=10,000$ Rs., $R=7\%$ and C.I. $=4026$

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

C.I. $=A-P$

$⟹A=C.I.+P$

$=4026+10000=14026$

$⟹14026=P{(1+\frac{R}{100})}^n$

$⟹14026=10000{(1+\frac{7}{100})}^n$

$⟹\frac{14026}{10000}={\left(\frac{107}{100}\right)}^n$

$⟹1.4026=(1.07{)}^n$

$⟹(1.07{)}^5=(1.07{)}^n$

$⟹n=5$ years

Hence, the period of interest will be $5$ years.