The compound interest on ₹20,000 at 5% per annum, compounded annually, is ₹2,050. What is the time period?

2 years

The Formula that we used here is -

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

Compound Interest = Amount - Principal

20000 + 2050 = 20000 [ 1 + \(\frac{5}{100}\)]t

22050 = 20000 [ 1 + \(\frac{5}{100}\)]t

\(\frac{441}{400}\) = [ 1 + \(\frac{5}{100}\)]t

(\(\frac{21}{20}\))²  = [  \(\frac{21}{100}\)]^t

So, t = 2 years