Multiple choice

In how much time will the sum of Rs. 3125 at 8% p.a. compound interest amount to Rs. 3645?

  1. 1 year

  2. 2 years

  3. 3 years

  4. 4 years

  5. 5 years
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

A = P(1 + r/100)^n. 3645 = 3125(1 + 0.08)^n. 3645/3125 = (1.08)^n. 1.1664 = (1.08)^n. Since 1.08^2 = 1.1664, n = 2.

AI explanation

Using the compound interest formula Amount equals Principal multiplied by 1 plus Rate over 100 raised to the power of Time, we substitute the given values to get 3645 equals 3125 multiplied by 1 plus 0.08 raised to the time. This simplifies to 3645 divided by 3125, which equals 1.08 multiplied twice. Therefore, the time is 2 years.

Keep practicing — related questions