A sum of Rs. 400 would become Rs. 441 after 2 years at r% compound interest

A sum of Rs. 400 would become Rs. 441 after 2 years at r% compound interest
Posted on 27-04-2023

Ques - A sum of Rs. 400 would become Rs. 441 after 2 years at r% compound interest, find the value of 'r' :

(a) 10%

(b) 5%

(c) 15%

(d) 20%

Solution - 

Given,

P = 400

A = 441

R = r%

T = 2

A = P (1 + (r/100))n

441 = 400 (1 + (r/100))2

441 / 400 = (1 + (r/100))2

(441 / 400)½ = 1 + (r/100)

21 / 20 = (100 + r) / 100

2100 / 20 = 100 + r

105 = 100 + r

105 - 100 = r

r = 5

Therefore,

The value of 'r' is 5%

Hence,

The correct answer is option (b) 5%.

Thank You