A sum of Rs 5000 amounts to Rs 7200 in 8 years at a certain rate percent per annum interest compounded yearly. What will be the compound interest on a sum of Rs 6550 in 4 years at the same rate of interest?
Show answer & explanation
Correct answer: D
Explanation
The correct answer is Option 4 i.e. Rs 1310
| Application |
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We know that, Amount = P(1 + r/100)t Where P is the principal: R =Rate: t =Time Given that a sum of Rs. 5,000 amounts to Rs. 7,200 in 8 years at a certain rate percent p.a, interest compounded yearly 7200 = 5000 (1 + r/100)8 = (1 + r/100)8 = 36/25 (1 + r/100)4 = √(36/25) = 6/5……………..(1) Amount = P(1 + r/100)t 6550 × (1 + r/100)4 = 6550 × 6/5 = Rs 7860 Interest = 7860 - 6550 = Rs 1310 |