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A Sum of Money is Lent at 8% per Annum Compound Interest. If the Interest for the Second Year Exceeds that for the First Year by Rs.96, Find the Sum of Money. - Mathematics

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Question

A sum of money is lent at 8% per annum compound interest. If the interest for the second year exceeds that for the first year by Rs. 96, find the sum of money.

Sum
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Solution

Let money be Rs100
For 1st year
P = Rs. 100; R = 8% and T = 1 year.
Interest for the first year = Rs. `[ 100 xx 8 xx 1]/100` = Rs. 8
Amount = Rs. 100 + Rs. 8 = Rs. 108

For 2nd year
P = Rs.108; R = 8% and T= 1year.
Interest for the second year= Rs. `[ 108 xx 8 xx 1]/100` = Rs. 8.64

Difference between the interests for the second and first year = Rs. 8.64 - Rs. 8 = Rs. 0.64
Given that interest for the second year exceeds the first year by Rs. 96.
When the difference between the interests is Rs. 0.64, principal is Rs. 100

When the difference between the interests is Rs96, principal = Rs. `[96 xx 100]/0.64` = Rs. 15,000.

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Concept of Compound Interest - Compound Interest as a Repeated Simple Interest Computation with a Growing Principal
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Chapter 2: Compound Interest (Without using formula) - Exercise 2 (B) [Page 33]

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Selina Concise Mathematics [English] Class 9 ICSE
Chapter 2 Compound Interest (Without using formula)
Exercise 2 (B) | Q 3 | Page 33
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