A sum on compound interest, compounding annually amounts to Rs.30,250 in 2 years and to Rs.33,275 in 3 years. Find the sum.
Show answer & explanation
Correct answer: D
Explanation
The correct answer is option 4 i.e. Rs. 25,000.
Formula used
A = P(1 + (r/100) )t
Given that
A sum (P) on compound interest amounts to 30250 in 2 years and to 33275 in 3 years.
The total interest = 33275 - 30250 = 3025 Rs
The rate of interest per annum = (3025/30250) × 100 = 10%
Calculations
A = P(1 + (r/100) )t
⇒ 30250 = P (1 + 10/100)2
⇒ P = 30250/1.21 = Rs. 25000