Question

A merchant starts with a certain capital and gains annually at the rate of 25%. At the end of 3 years his capital is worth Rs 10,000. What was his original capital?

(a) Rs 5120

(b) Rs 5220

(c) Rs 5210

(d) Rs 5130

Answer 1

Correct option is (a) Rs 5120

Let the original sum of the amount be x.

Given:

A = Rs.10,000

t = 3 years

r = 25%

So, by using the formula to calculate the compound interest,

Hence, the initial amount was Rs. 5120.