Correct Answer - Option 1 : Rs. 4096
Given:
Amount in second year = 4624 Rs.
Amount in Third year = 4913 Rs.
Formula used
\(Amount = P\;{\left( {1 + \frac{r}{{100}}} \right)^t}\)
Where P is the principal, r is the rate of interest and t be the time
Solution:
Accordingly,
\(4624 = \;{P\left( {1 + \frac{r}{{100}}} \right)^2}\) ----(i)
\(4913 = P\;{\left( {1 + \frac{r}{{100}}} \right)^3}\) ----(ii)
Divide eq (ii) by (i)
\(\frac{{4913}}{{4624}} = {\left( {1 + \frac{r}{{100}}} \right)^1}\) ----(iii)
\(r = \frac{{\left( {4913 - 4624} \right) × 100}}{{4624}} \)
r = 6.25%
6.25% = 1/16
from Eq (i)
4624 = P× (17/16)× (17/16)
⇒ P = 4096
∴ The sum of money is Rs. 4096