Question

A sum becomes ₹12100 in 2 years at 10% Compound Interest annually. Find the principal.

• A. ₹10000
• B. ₹11000
• C. ₹11500
• D. ₹10500

Answer 1

Answer:

A. ₹10000

Use the compound interest formula:

$A=P\left(1+\frac{R}{100}\right)^n$

Where:

• (A = ₹12100)

• (R = 10%)

• (n = 2) years

• (P = ?)

$12100=P\left(1+\frac{10}{100}\right)^2$
$12100=P(1.1)^2$
$12100=P(1.21)$

$P=\frac{12100}{1.21}=10000$

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