The principal that yield a compound interest of Rs.420 during the second year at 5% per annum is
1). Rs.7,000
2). Rs.5,000
3). Rs.8,000
4). Rs.6,000
Here is the right answer
Let the principal be Rs. P.
According to the question,
$p\times\frac{21}{20}=420\times 20$
P = 8000