A sum of money becomes ₹ 3,364 at a rate of 16% compounded annually for 2 years. The sum of money is:

₹2,500

The formula that we used here is :-

Amount = P$(1 \;+\; \frac{R}{100})^t$

3364 = P [ 1 + \(\frac{16}{100}\) ]²

3364 = P [  \(\frac{29}{25}\) ]²

P = 3364 × \(\frac{25}{29}\) × \(\frac{25}{29}\)

= 2500

So, Initial sum is = Rs. 2500