| At what rate of interest will Rs. 12000 becomes Rs. 14520 after 2 yr when interest is compounded annually. |
A) 5% per annum
B) 10% per annum
C) 8.5% per annum
D) 9.5% per annum
Correct Answer: B
Solution :
| Principal (P) = 12000, Amount [a] = Rs. 14520 and time (T) = 2 yr. |
| Let rate be R% |
| \[\therefore \]We know that, \[A=P{{\left( 1+\frac{R}{100} \right)}^{T}}\] |
| \[\Rightarrow \]\[14520=12000{{\left( 1+\frac{R}{100} \right)}^{2}}\] |
| \[\Rightarrow \]\[\frac{14520}{12000}={{\left( 1+\frac{R}{100} \right)}^{2}}\]\[\Rightarrow \]\[{{\left( \frac{11}{10} \right)}^{2}}={{\left( 1+\frac{R}{100} \right)}^{2}}\] |
| \[\Rightarrow \]\[\frac{11}{10}=1+\frac{R}{100}\]\[\Rightarrow \]\[=\frac{R}{100}=\frac{11}{10}-1\] |
| \[\therefore \] \[R=10\]% per annum |
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