Question

Three years ago, the price of a plot of land was ₹ 1,20,000. If the price of land increased at 10% p.a., what is its present price?

Answer 1

Given, three years ago, the price of a plot of land was ₹ 120000.

Principal, P = ₹ 120000

Time, T = 3 years

Rate of interest, R = 10% p.a. annum

Amount = `P(1 + R/100)^T`, where P is the principal, R is the rate of interest and T is the time period

∴ Present price of the land = `120000(1 + 10/100)^3`

= `120000(11/10)^3`

= 159720

Hence, the present price of land is ₹ 159720.