₹ 2000 amounts to ₹ 2226.05 in 2 yea

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Target Exam

CUET

Subject

General Test

Chapter

Numerical Ability

Topic

Compound Interest

Question:

₹ 2000 amounts to ₹ 2226.05 in 2 years on compound interest. What is the rate of interest per annum?

Options:

5.25%

5.5%

Correct Answer:

5.5%

Explanation:

We have,

Rs 226.05 is the interest

Principal = Rs 2000

Time = 2 years

Rate = r%.

So we know that,

Interest = P{(1+r/100)ⁿ−1}

226.05 = 2000{(1+r/100)²−1}

So, r = 5.5%.