Practicing Success

Target Exam

CUET

Subject

General Test

Chapter

Numerical Ability

Topic

Compound Interest

Question:

At a certain rate of interest compounded annually, a sum amounts to ₹10,890 in 2 years and to ₹11,979 in 3 years. The sum is:

Options:

₹9,000

₹8,000

₹8,500

₹9,500

Correct Answer:

₹9,000

Explanation:

Difference in amount after 2 and 3 years = 11979 - 10890 = 1089

Rate of Interest = \(\frac{1089}{10890}\) × 100% = 10%

Now, To find out initial sum ,

Formula used in case of compound interest,

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

10890 = P [ 1 + \(\frac{10}{100}\) ]²

10890 = P [ \(\frac{11}{10}\) ]²

P = 10890 × \(\frac{10}{11}\) × \(\frac{10}{11}\)

= 9000 

So, Initial sum is Rs. 9000