Ac sum amounts to Rs. 6580 in 2 years and amounts to Rs. 7896 in 3 years on compound interest (compounded annually) at the same rate of interest. What is the annual rate of interest ?

20 percent

Compound interest = Principal × ( 1 + \(\frac{rate }{100}\) )^t - Principal

ATQ,

CI = 7896 - 6580 = 1316

1316 = 6580 × ( 1 + \(\frac{rate }{100}\) )¹ - 6580

7896 = 6580 × ( 1 + \(\frac{rate }{100}\) )

1 + \(\frac{rate }{100}\) = \(\frac{7896 }{6580}\)

\(\frac{rate }{100}\) = \(\frac{1316 }{6580}\)

rate = 20%