the compound interest calculated yearly on a certain sum of money for the second year is Rs. 880 and for the third year is Rs.968 calculate the rate of interest and the actual money
Hi!
Here is the answer to your question.
Let the actual sum of money be Rs. P and the rate of interest be r% per annum
Compound Interest for the second year
= Amount at the end of 2nd year – Amount at the end of 1st year
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Substituting r = 10, in equation (1), we get
Thus, the rate of interest and actual sum of money are 10% per annum and Rs 8000 respectively.
Cheers!