What sum of money will amount to ₹ 9261.

What sum of money will amount to ₹ 9261 in 3 years at 5% per annum compound interest?

Solution:

It is given that
Amount (A) = ₹ 9261
Rate of interest (r) = 5% per annum
Period (n) = 3 years
We know that
A = P (1 + r/100)n
Substituting the values
9261 = P (1 + 5/100)3
By further calculation
9261 = P (21/20)3
So we get
P = (9261 × 20 × 20 × 20)/ (21 × 21 × 21)
P = ₹ 8000
Therefore, the sum of money is ₹ 8000.

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