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  1. What will be the principle, if the rate of 5% per annum can yield ₹ 410 as compound interest in 2 yr?
    1. ₹ 4000
    2. ₹ 42000
    3. ₹ 8000
    4. ₹ 21000
Correct Option: A

Let the amount be ₹ P
R = 5%, n = 2 yr and CI ₹ 410
By formula, CI = P [ (1 + R/100)n - 1 ]
⇒ 410 = P [ (1 + 5/100)2 - 1]
⇒ 410 = P [ (1 + 1/20)2 - 1]
⇒ 410 = P [ (21/20)2 - 1]
⇒ 410 = P [ 441/400 - 1 ]
⇒ 410 = P [(441 - 400) /400] = P x 41/400
⇒ P = (410 x 400)/41
∴ P = ₹ 4000



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