A sum amounts to Rs7,562 in 4 years and to Rs 8,469,44 in 5 years at a certain rate cent annum , when the interst is compounded yearly. The rate of interest is :
Show answer & explanation
Correct answer: B
Explanation
The correct answer is option 2 i.e. 12%
A sum amounts to Rs. 7,562 in 4 years and to Rs. 8,469.44 in 5 years at a certain rate percent per annum.
Amount = Principal(1 + rate/100)time
Let, P be the principal.
P(1 + r/100)4 = 7562 ....(1
P(1 + r/100)5 = 8469.44 ....(2
Divided (2) by (1) get,
(1 + r/100) = 846944/756200
r/100 = 1.12 - 1
r = 12%