The sum of money that yields a compound interest on 420 Rs. during the second year at 5% per annum is :
Q. The sum of money that yields a compound interest on 420 Rs. during the second year at 5% per annum is :
Answer: 8000 Rs
Notes: $latex CI = P\left [ \left ( 1+\frac{R}{100} \right )^{T}-1 \right ] - \frac{PR}{100}&s=1$ $latex => 420 = P \left [ \left ( 1+\frac{5}{100} \right )^{2}-1 \right ] - \frac{P\times 5}{100}&s=1$ $latex => 420 = P \left [ \left ( \frac{21}{20} \right )^{2}-1 \right ]-\frac{5P}{100}&s=1$ $latex => 420 = \frac{41P}{400}-\frac{5P}{100} = \frac{21P}{400}&s=1$ $latex => P = \frac{420\times 400}{21} = 8000\ Rs.&s=1$ Hence option [D] is correct answer.