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A certain sum invested at 4% per annum compound interest, compounded half-yearly, amounts to Rs 7803 after the end of one year. The sum is?
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A certain sum invested at 4% per annum compound interest, compounded half-yearly, amounts to Rs 7803 after the end of one year. The sum is?
1). 7000
2). 7200
3). 7500
4). 7700
2 answers
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We have R = 4 % per annum or 2 % per half-year
T = 2 cycles of half years. Hence we take t = 2.
P = ?
Amount = Rs 7803
We have the formula for compound interest
Amount $(= P{\left( {1 + \frac{R}{{100}}} \right)^T})$
Where P is the principal
T is the time
R is the rate of interest
⇒ 7803 = P ( 1 + 2/100)2
⇒ 7803 = P × 1.02 × 1.02
⇒ P = 7803/1.0404
⇒ P = Rs 75000 vote
A=P(1+r/200) ^2
7803=P(1+2/100) ^2
P=7500