Electrical Engineering (EE) Exam > Electrical Engineering (EE) Questions > A sum of money compounded annually becomes Rs...
Start Learning for Free
A sum of money compounded annually becomes Rs. 625 in 2 years and Rs. 675 in 3 years. The rate of interest per annum is
- a)7%
- b)10%
- c)6%
- d)8%
Correct answer is option 'D'. Can you explain this answer?
| FREE This question is part of | Download PDF Attempt this Test |
Most Upvoted Answer
A sum of money compounded annually becomes Rs. 625 in 2 years and Rs. ...
Given:
- The sum of money compounded annually becomes Rs. 625 in 2 years.
- The sum of money compounded annually becomes Rs. 675 in 3 years.
To find:
The rate of interest per annum.
Solution:
Let's assume the principal amount as P and the rate of interest as R%.
Compound Interest Formula:
The formula to calculate the compound interest is:
A = P(1 + R/100)^n
Where:
A = Final amount
P = Principal amount
R = Rate of interest per annum
n = Number of compounding periods
Using the given information:
1) We know that the sum of money becomes Rs. 625 in 2 years.
Using the compound interest formula:
625 = P(1 + R/100)^2
2) We also know that the sum of money becomes Rs. 675 in 3 years.
Using the compound interest formula:
675 = P(1 + R/100)^3
We have two equations with two unknowns (P and R). We can solve these equations simultaneously to find the value of R.
Solving the equations:
1) Divide the second equation by the first equation:
675/625 = (P(1 + R/100)^3) / (P(1 + R/100)^2)
1.08 = (1 + R/100)
2) Subtract 1 from both sides:
0.08 = R/100
3) Multiply both sides by 100:
8 = R
Therefore, the rate of interest per annum is 8%.
Conclusion:
The rate of interest per annum is 8% (option D).
- The sum of money compounded annually becomes Rs. 625 in 2 years.
- The sum of money compounded annually becomes Rs. 675 in 3 years.
To find:
The rate of interest per annum.
Solution:
Let's assume the principal amount as P and the rate of interest as R%.
Compound Interest Formula:
The formula to calculate the compound interest is:
A = P(1 + R/100)^n
Where:
A = Final amount
P = Principal amount
R = Rate of interest per annum
n = Number of compounding periods
Using the given information:
1) We know that the sum of money becomes Rs. 625 in 2 years.
Using the compound interest formula:
625 = P(1 + R/100)^2
2) We also know that the sum of money becomes Rs. 675 in 3 years.
Using the compound interest formula:
675 = P(1 + R/100)^3
We have two equations with two unknowns (P and R). We can solve these equations simultaneously to find the value of R.
Solving the equations:
1) Divide the second equation by the first equation:
675/625 = (P(1 + R/100)^3) / (P(1 + R/100)^2)
1.08 = (1 + R/100)
2) Subtract 1 from both sides:
0.08 = R/100
3) Multiply both sides by 100:
8 = R
Therefore, the rate of interest per annum is 8%.
Conclusion:
The rate of interest per annum is 8% (option D).
Free Test
FREE
| Start Free Test |
Community Answer
A sum of money compounded annually becomes Rs. 625 in 2 years and Rs. ...
For a difference of 1 year, CI can be computed as SI. Hence From the 2nd year to the 3rd year, interest earned = (675-650) = Rs.50 on Rs.625
which is the interest component
Hence, the rate of interest = 50/625x100 = 8% per annum
Alternative method :
Since the values are for consecutive years,
which is the interest component1/25 = 4%
∴ 2/25 = 8%
Attention Electrical Engineering (EE) Students!
To make sure you are not studying endlessly, EduRev has designed Electrical Engineering (EE) study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in Electrical Engineering (EE).
|
Explore Courses for Electrical Engineering (EE) exam
|
|
Similar Electrical Engineering (EE) Doubts
Top Courses for Electrical Engineering (EE)View all
A sum of money compounded annually becomes Rs. 625 in 2 years and Rs. 675 in 3 years. The rate of interest per annum isa)7%b)10%c)6%d)8%Correct answer is option 'D'. Can you explain this answer?
Question Description
A sum of money compounded annually becomes Rs. 625 in 2 years and Rs. 675 in 3 years. The rate of interest per annum isa)7%b)10%c)6%d)8%Correct answer is option 'D'. Can you explain this answer? for Electrical Engineering (EE) 2024 is part of Electrical Engineering (EE) preparation. The Question and answers have been prepared according to the Electrical Engineering (EE) exam syllabus. Information about A sum of money compounded annually becomes Rs. 625 in 2 years and Rs. 675 in 3 years. The rate of interest per annum isa)7%b)10%c)6%d)8%Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for Electrical Engineering (EE) 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A sum of money compounded annually becomes Rs. 625 in 2 years and Rs. 675 in 3 years. The rate of interest per annum isa)7%b)10%c)6%d)8%Correct answer is option 'D'. Can you explain this answer?.
A sum of money compounded annually becomes Rs. 625 in 2 years and Rs. 675 in 3 years. The rate of interest per annum isa)7%b)10%c)6%d)8%Correct answer is option 'D'. Can you explain this answer? for Electrical Engineering (EE) 2024 is part of Electrical Engineering (EE) preparation. The Question and answers have been prepared according to the Electrical Engineering (EE) exam syllabus. Information about A sum of money compounded annually becomes Rs. 625 in 2 years and Rs. 675 in 3 years. The rate of interest per annum isa)7%b)10%c)6%d)8%Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for Electrical Engineering (EE) 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A sum of money compounded annually becomes Rs. 625 in 2 years and Rs. 675 in 3 years. The rate of interest per annum isa)7%b)10%c)6%d)8%Correct answer is option 'D'. Can you explain this answer?.
Solutions for A sum of money compounded annually becomes Rs. 625 in 2 years and Rs. 675 in 3 years. The rate of interest per annum isa)7%b)10%c)6%d)8%Correct answer is option 'D'. Can you explain this answer? in English & in Hindi are available as part of our courses for Electrical Engineering (EE).
Download more important topics, notes, lectures and mock test series for Electrical Engineering (EE) Exam by signing up for free.
Here you can find the meaning of A sum of money compounded annually becomes Rs. 625 in 2 years and Rs. 675 in 3 years. The rate of interest per annum isa)7%b)10%c)6%d)8%Correct answer is option 'D'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
A sum of money compounded annually becomes Rs. 625 in 2 years and Rs. 675 in 3 years. The rate of interest per annum isa)7%b)10%c)6%d)8%Correct answer is option 'D'. Can you explain this answer?, a detailed solution for A sum of money compounded annually becomes Rs. 625 in 2 years and Rs. 675 in 3 years. The rate of interest per annum isa)7%b)10%c)6%d)8%Correct answer is option 'D'. Can you explain this answer? has been provided alongside types of A sum of money compounded annually becomes Rs. 625 in 2 years and Rs. 675 in 3 years. The rate of interest per annum isa)7%b)10%c)6%d)8%Correct answer is option 'D'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice A sum of money compounded annually becomes Rs. 625 in 2 years and Rs. 675 in 3 years. The rate of interest per annum isa)7%b)10%c)6%d)8%Correct answer is option 'D'. Can you explain this answer? tests, examples and also practice Electrical Engineering (EE) tests.
|
|
Explore Courses for Electrical Engineering (EE) exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
Follow Us
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup