Question

Where interest is compounded annually, what amount of money given at 10% per annum compound interest will become Rs 1331 in 2 years.
1. Rs 1000
2. Rs 1100
3. Rs 1300
4. Rs 1200

Answer 1

Correct Answer - Option 2 : Rs 1100

Given 

Amount after 2 years = Rs 1331

Rate of Interest = 10% 

Formula Used

Amount = Principal(1 + Rate/100)^t

Calculation 

Let the principal be P

From the Data, 

⇒ 1331 = P(1 + 10/100)² 

⇒ P = 1100 

∴ The amount of money is given is Rs 1100