Question

What principal will amount to Rs. 9,856 in two years, if the rates of interest for successive years are 10% and 12% respectively?

Answer 1

Let Principal ${=}^{\prime }{P}^{\prime }$

Amount $=Rs9856$

$R_1=10$%

$R_2=12$%

$T=2$ year

$A=P(1+\frac{R_1}{100})(1+\frac{R_2}{100})$

$\Rightarrow 9856=P\left(\frac{11}{70}\right)\left(\frac{28}{25}\right)$

$\Rightarrow P=\frac{9856\times 10\times 25}{11\times 28}$

$=8000$

Hence, Principal is $Rs8000$.