Multiple choice

The present worth of Rs. $169$ due in $2$ years at $4\%$ per annum compounded interest is:

  1. Rs. $150.50$
  2. Rs. $154.75$
  3. Rs. $156.25$
  4. Rs.$158$
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C Correct answer
Explanation

Present worth = Amount / (1 + r/100)^n. PW = 169 / (1 + 4/100)^2 = 169 / (1.04)^2 = 169 / 1.0816 = 156.25.

AI explanation

Using the present worth formula for compound interest P = A / (1 + R/100)^n, we substitute the given values to find the principal. This gives P = 169 / (1 + 4/100)^2, which simplifies to 169 / (26/25)^2. Calculating further, 169 is divided by 676/625, which results in a present worth of Rs. 156.25.

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