Multiple choice

A sum invested at compound interest amounts to Rs. 8,800 in 1 year and to Rs. 10,648 in 3 years. Calculate the rate percent and the sum.

  1. 10 and Rs. 8,000

  2. 12 and Rs. 5,000

  3. 10 and Rs. 6,000

  4. 12 and Rs. 8,000
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

A(1) = P(1+r) = 8800. A(3) = P(1+r)^3 = 10648. (1+r)^2 = 10648/8800 = 1.21. 1+r = 1.1, so r = 0.1 or 10%. P = 8800/1.1 = 8000.

AI explanation

Let the sum be P and the rate be R percent, so the amount after 1 year is P multiplied by (1 + R/100) equals 8800. The amount after 3 years is P multiplied by (1 + R/100) cubed equals 10648, and dividing the 3-year amount by the 1-year amount gives (1 + R/100) squared equals 1.21. Taking the square root gives 1 + R/100 equals 1.1, so R is 10 percent. Substituting this back into the first equation gives P equals 8800 divided by 1.1, which is 8000; the rate is 10 percent and the sum is Rs. 8000.

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