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Find the compound interest at the rate of 10% per annum for two years on thatprincipal, which in two years at the rate of 10% per annum given Rs 200 as simpleinterest.

Question

Find the compound interest at the rate of 10% per annum for two years on thatprincipal, which in two years at the rate of 10% per annum given Rs 200 as simpleinterest.

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Solution

To solve this problem, we first need to find the principal amount. We know that the formula for simple interest is:

I = PRT/100

Where: I = Interest P = Principal amount R = Rate of interest T = Time period

Given in the problem, I = Rs 200, R = 10% per annum, and T = 2 years. We can substitute these values into the formula and solve for P:

200 = P * 10 * 2 / 100 200 = P * 20 / 100 200 = P * 0.2 P = 200 / 0.2 P = Rs 1000

Now that we have the principal amount, we can find the compound interest. The formula for compound interest is:

A = P (1 + R/100)^T

Where: A = the total amount after interest P = Principal amount R = Rate of interest T = Time period

Substituting the values we have:

A = 1000 (1 + 10/100)^2 A = 1000 (1.1)^2 A = 1000 * 1.21 A = Rs 1210

The compound interest is then A - P, which is Rs 1210 - Rs 1000 = Rs 210.

This problem has been solved

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