A sum of money grows to ₹8,000 in 2 years and ₹9,600 in 3 years with compound interest. What was the original amount?
Show answer & explanation
Correct answer: C
Explanation
The correct answer is option 3 i.e. ₹5,556.
R = [(9600 - 8000)/8000] × 100 = 20%
A = P × (1 + R/100)2
⇒ 8,000 = P × (1 + 20/100)2
⇒ 8,000 = P × (6/5)2
⇒ 8,000 = P × 36/25
P = 8,000 × 25 / 36 ≈ ₹5,556