A sum amounts to Rs.6,120 in 2 years and Rs. 7,340 in 3 years at compound interest. The sum (in) is (rounded off to 2 decimal places)
Show answer & explanation
Correct answer: B
Explanation
The correct answer is option 2 i.e. 4,254.63
Given that
In 2 years, Amount = Rs. 6120
in 3 years, Amount = Rs. 7,340
Formula used
Amount = Principal (1 + Rate/100)Time
Calculation
⇒ 7340 = P (1 + R/100)3 .......(1
⇒ 6120 = P (1 + R/100)2 .......(2
Equation 1/Equation 2
⇒ 1 + R/100 = 7340/6120 = 1.199
⇒ R = 19.93% p.a.
From equation 2
⇒ 6120 = P (1 + 19.93/100)2
⇒ P = 4,254.63