Correct Answer - Option 3 : Rs. 87,400
Formula Used :
For compound interest
A = P(1 + R/100)n
where P → Principal Amount
A → Final Amount
R→ Interest rate
n → Time Period
Compound Interest (CI) = A – P
⇒ CI = P(1 + R/100)n – P
For simple interest
SI = (P × R × T)/100
where P → Principal Amount
SI → Simple Interest
R→ Interest rate
T → Time Period
∴ According to question,
P(1 + 10/100)2 – P – (P × 10 × 2)/100 = 874
⇒ 1..21P – P – 0.20P = 874
⇒ 0.01P = 874 or P = 87400
∴ The sum is Rs.87,400