Multiple choice

A certain sum amounts to Rs. $ 1331 $ in $1 \dfrac{1}{2}$ years at $20\%$ p.a. compound interest compounded half yearly. Determine the sum.

  1. Rs. $990$
  2. Rs. $1050$
  3. Rs. $1000$
  4. Rs. $1250$
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Amount = P(1 + r/200)^(2n). 1331 = P(1 + 20/200)^(2 * 1.5) = P(1.1)^3 = P(1.331). P = 1331 / 1.331 = 1000.

AI explanation

Using the Compound Interest formula, Amount = Principal x (1 + Rate / (100 x n)) raised to the power of (Time x n), where the annual rate is 20% and the number of compounding periods per year (n) is 2. Substituting the values gives 1331 = Principal x (1 + 0.10) raised to the power of 3. This simplifies to 1331 = Principal x 1.331, meaning the original sum is Rs. 1000.

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