What principal will amount to Rs.5,324 in 2 years, when the interest is compounded at 10% per annum, compounding annually?
Show answer & explanation
Correct answer: A
Explanation
The correct answer is option 1 i.e. Rs.4,400.
A = 5324
r = 10%
n = 2 year
A = P(1 + r/100)n
5324 = P(1 + 10/100)2
5324 = 121P/100
P = 4400