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Question
At what rate of compound interest per annum will a sum of Rs. 1200 become Rs. 1348.32 in 2 years?
Options
6%
6.5%
7%
7.5%
MCQ
Solution
6%
Explanation:
Let the rate be R% p.a.
Then, 1200 x = `(1 + R/100)^2` = 1348.32
⇒ `(1 + R/100)^2 = 134832/120000 = 11236/10000`
∴ `(1 + R/100)^2 = (106/100)^2`
⇒ `1 + R/100 = 106/100`
⇒ R = 6%
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Simple and Compound Interest (Entrance Exam)
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